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There’s something about Zain

There’s something about Zain

Keep hearing about Zain but have no idea why? It’s because everyone wants a piece of it, seemingly. Let Kipp give you a quick rundown of who, what and why.

January 13, 2011 3:14 by

When a colleague recently traveled to Kuwait for a conference, Kipp asked them how it was (Kipp has never been to Kuwait, as we are not allowed out of the office much, and rarely allowed to board aeroplanes. There was an… incident).

“Dull,” said our colleague. “There are is absolutely nothing happening in Kuwait, and they’re about ten years behind everywhere else.” Ouch.

But our colleague wasn’t exactly correct; there’s plenty going on in Kuwait, you just have to know where to look. For instance, like sharks circling a hunk of meat, all of the action right now can be found swirling around telecoms company Zain.

“Ah yes,” you say. “Zain. I keep reading about that, but never paid attention. What’s going on?” Well, this week it’s been reported that a company named Cukurova Holding is in talks to buy a hefty stake. But not so long ago Etisalat was making a move. So what is Zain, who wants it, how much will they pay?

What is it?

Zain Group used to be known as MTC back in the day, or the Mobile Telecommunications Company (yep, whoever named it was a creative chap). The company, which provided mobile telecommunications, if you can believe that, was founded in Kuwait in 1983. It was rebranded Zain in 2007, presumably to make it sound much cooler. The company has a commercial presence in Bahrain, Iraq, Jordan, Kuwait, Lebanon, Morocco, Saudi Arabia and Sudan, and can boast no fewer than 5,000 employees and more than 35 million customers.

Who wants it?

Suitor #1 is Cukurova Holding, the Turkish company behind Turkcell. It wants to buy 29.9 percent of the company for $7.89 billion. That values the company at 1.72 dinars a share.

Suitor #2 is everyone’s second favourite UAE telco, Etisalat. It launched an attempt to acquire 46 percent of Zain back in November in a deal that valued the Kuwaiti company at 1.7 dinars per share. The deal would be worth a whopping $11.7 billion total.


So why do these companies want it? Well, for one thing, it’s attainable. Zain is listed on the Kuwait Stock Exchange, and 100 percent of its shares are traded. Thirty five million customers across eight countries just waiting to be bought. Results for the first half of last year had revenues of $2.33 billion. Also, last year the company sold Zain Afric BV to Bharti Airtel Limited for more than $10 billion. So what we have is a successful business that operates in growing markets with a solid customer base and healthy financials, and it’s pretty much up for sale.

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