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Etisalat says still wants to buy 46 pct stake in Zain

Comments comes after market speculation that the consortium is struggling to recruit enough shareholders to reach the 46 percent threshold

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December 19, 2010 3:48 by



Abu Dhabi’s Etisalat still wants to buy a 46-percent stake in Kuwaiti rival Zain from a consortium headed by a major Zain shareholder, Etisalat said on Sunday.

“The 46 percent conditional deal is still on as agreed upon in the initial proposal,” an Etisalat spokesman said in a statement.

The Abu Dhabi-based telco struck a $12 billion deal with a group led by major shareholder Kharafi Group to buy the Zain stake.

On Thursday, two sources told Reuters that Etisalat was now seeking to buy a 40-percent stake in the Kuwaiti telco after the consortium deal met opposition from other Zain shareholders.

There has been market speculation that the consortium is struggling to recruit enough shareholders to reach the 46 percent threshold.

This has prompted talk that Etisalat may buy directly shares from other shareholders or on the open market to reach the desired 46 percent.

A Kuwaiti court will this week rule on a lawsuit from a Zain shareholder unhappy with Etisalat’s bid. The shareholder — Al Fawares Holding — which owns a 4.5 percent stake in Zain, took legal action to halt the due diligence in the planned sale.

In October, the Kuwait bourse vetoed a bid by Securities Group Co for about 5 percent in telecom group Zain, a move that was designed to protest against the Kharafi-led deal.

(Reporting by Matt Smith; Editing by Amran Abocar)



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