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Etisalat wants to be ready for M&A – Interview
Etisalat operates in 15 countries across the Middle East, Africa and Asia after a multi-billion dollar splurge buying foreign licences and stakes over the past decade.
October 24, 2012 5:26 by Reuters
Middle East telecom operator Etisalat expects a shakeout in the sector to throw up takeover opportunities in the next 18 months and wants to be ready, keeping its war chest replete.
“Today a telecom company with deep pockets is much better than one with huge debts,” chief executive Ahmad Julfar told Reuters in an interview by phone on Wednesday.
Asked whether Etisalat was mulling a bid for Vivendi’s Maroc Telecom, he said: “We are not part of that yet.”
Vivendi has asked bankers to hold talks with potential buyers of its 53 percent holding in Maroc Telecom, which has a market value of 4.35 billion euros ($5.64 billion). The French media-to-telecom conglomerate is seeking to sell assets to cut debt and boost its flagging shares.
Etisalat and regional rival Qatar Telecom have been cited as possible bidders, and no deadline for bids has been set.
“Telecoms is a very capex intensive business. It is a long-term investment and sustainability is crucial to us so we have to look at how to best invest our money. The crisis in the market will provide M&A opportunities over the next 18 months. We would like to be ready when those opportunities are there.”
A bid for Maroc Telecom would represent a major undertaking for Etisalat, which has a net cash balance of 7.2 billion dirhams ($2.0 billion).
Etisalat operates in 15 countries across the Middle East, Africa and Asia after a multi-billion dollar splurge buying foreign licences and stakes over the past decade, which has yet to provide the expected returns.
Last year, it scrapped a plan to buy a $12 billion stake in Kuwaiti telco Zain.
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