Sunday, 20 February 2011

Zain Drops Most Since June on Concern Purchase by Etisalat May Not Occur - Bloomberg

Mobile Telecommunications Co., the phone operator known as Zain, fell the most in eight months after its board rejected purchase offers for its 25 percent stake in Zain Saudi Arabia and three executives resigned.

Zain, Kuwait’s biggest phone company, also received commitments from banks for a $1.2 billion loan, Chief Financial Officer Ossama Matta said in Kuwait City today. The shares lost 7.3 percent, the most since June 9, to 1,280 fils at the 12:30 p.m. close in Kuwait City.

Etisalat, as Emirates Telecommunications is known, is in talks with Zain shareholders to buy a majority in the Kuwaiti company and has said Zain needs to sell its stake in the Saudi unit in a “timely fashion” for the deal to proceed. Etisalat’s due diligence process to buy 46 percent of Zain will not be extended beyond the end of the month, said National Investments Co. The company is arranging the transaction for Al-Khair National for Stocks & Real Estate, which holds a stake in Zain.

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