| Kippreport.com

The Zain Saga: Oscar-worthy?

February 24, 2011 1:27 by Samuel Potter

“I am convinced that the deal, as all the conditions that you’re aware of, is not going to be met,” said Sheikh Khalifa. “So it’s over.” He termed the bids for Zain Saudi as “unacceptable.”

Kipp would like to think that was the end of the matter, but we’re not so sure. Sheikh Khalifa has been a particularly vocal opponent of the Etisalat acquisition, and this proclamation of the death of the deal could just be wishful thinking, or a tactic, or both. Convince the shareholders it is dead and the board may start to think the same way…

After the bids for Zain Saudi were given the silver bullet (we’ve totally lost track of the vampire-werewolf film plot now), shares in Zain dropped and the company went into defensive mode.

The telco announced a few days ago that it plans to cut 40 percent of its staff and reorganize its senior management structure. Chief exec Nabil Bin Salama said “My strategy is to restructure and decrease the number in the Group as much as possible in order to receive the preferred benefits.” The announcement followed the departure of the company’s chief operating officer, its chief strategy and business officer as well as an adviser to the chief executive, which followed the rejection’s of the Zain Saudi offers.

And at Zain Saudi, a company which has been making ongoing losses, a shareholder meeting is being planned to vote on cutting the subsidiary’s capital by 55 percent. This would form part of a restructure with a possible rights issue following later on to raise cash.

So that’s all the major plot points for now, you get started on the screenplay and we’ll get Matt Damon on the phone (he’s so hot right now). Just one thing: is this all really happening? Or is it just a dream within a dream within a dream? Either way it’s an Oscar cert.

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