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Zain Saudi CEO eyeing stake buyout – sources
Zain Saudi CEO seeking national, regional fund backing; MTN and Batelco have already expressed interest
January 26, 2011 3:53 by Reuters
Zain Saudi Arabia chief executive Saad al-Barrak is looking for backers for a buyout of Zain’s 2.75 billion riyal ($733 million) stake, four people familiar with the matter said.
“Al-Barrak has approached several Saudi and regional funds trying to put together money for the acquisition,” one of the people said.
Kuwaiti-based Zain has to sell its 25 percent stake in Zain Saudi for regulatory reasons so that its $12 billion sale of 46 percent of its stock to Etisalat, the Gulf’s second largest telecom operator by market value, can proceed.
The deal with Etisalat is driven by family conglomerate Kharafi Group, a major shareholder in Kuwaiti-based Zain.
UBS was appointed in December to sell the Zain Saudi stake because both Etisalat and Zain have units and compete for market share in the country.
Bahrain Telecommunications, or Batelco, and South African group MTN have expressed interest in the stake, other people said previously..
Al-Barrak resigned as chief executive of the wider Zain group a year ago when a previous attempt by the Kharafis to sell the stake to a group of Asian investors for $13.7 billion was collapsing.
By Victoria Howley and Ulf Laessing
(Additional reporting by Eman Goma; Editing by Dan Lalor)