Kuwaiti telecommunications operator Zain said Sunday it is
considering an offer for most of its Africa businesses, a day after
local media reported a bid was on the table from India’s Bharti
Airtel worth up to US$10,7bn.
Africa has become a key region for the Gulf mobile phone operator, known officially as Mobile Telecommunications Co, and a sale of its businesses there would slash the number of countries where the company operates by more than half.
A deal would not be entirely unexpected, however. Zain has been hinting at plans to offload its African assets for months, saying in July it was putting its holdings on the continent under “strategic review.” The company provided few details about the latest bid.
“Zain has received an offer in relation to its operations in Africa excluding Morocco and Sudan. The board of directors of Zain will be discussing this proposal” Sunday afternoon, the company said. “Further announcements will be made as appropriate.” A Zain spokesman declined to comment further, citing confidentiality agreements.
Word of a new offer comes less than two weeks after Zain’s chief executive, Saad al-Barrak, announced his resignation. He served as both MD and deputy chairman, giving him considerable influence over the company’s direction since his appointment in 2002. No reason was given for his departure.
Al-Barrak was replaced as chief executive by Kuwait’s former communication, electricity and water minister, Nabil Bin Salama, last week. Sunday is his first day as CEO.
Though Zain did not name its suitor, Kuwaiti newspapers, including al-Rai and al-Qabas, identified the buyer as India’s Bharti Airtel and reported a purchase price of $10,7bn, without naming their sources.
Bharti could not immediately be reached for comment.
Kuwait’s stock exchange halted trading of Zain shares Sunday pending further information from the company. Zain has floated an African assets sale before.
Talks with French media conglomerate Vivendi SA for the holdings became official last July but fell through later that month. Vivendi had wanted to buy a majority stake in the African businesses to expand its presence in growing emerging markets.
Zain announced a review of the holdings after Vivendi walked away from the deal. It said it had received interest from “several parties” for the African assets and would consider any proposals.
Bharti has also shown interest in the Kuwaiti telecoms company. Bharti director Akhil Gupta said in October that “if an opportunity about Zain comes, I am not saying we are not interested or not looking at it.” Bharti previously tried to expand into Africa by merging with SA’s MTN Group, but that deal fell apart for the second time amid political pressure in September.
Zain has more than 70m active customers across 23 countries. In Africa, it operates in Burkina Faso, Chad, the Republic of Congo, the Democratic Republic of Congo, Gabon, Ghana, Kenya, Malawi, Madagascar, Morocco, Niger, Nigeria, Sierra Leone, Sudan, Tanzania, Uganda and Zambia. — Sapa-AP
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