Jordan Telecom mulls Dubai IPO

JORDAN’S government is considering the sale of a stake in the kingdom’s incumbent telco on Dubai’s new stock exchange, Arabian Business can reveal.

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By  Richard Agnew Published  October 2, 2005

JORDAN’S government is considering the sale of a stake in the kingdom’s incumbent telco on Dubai’s new stock exchange, Arabian Business can reveal. The move, tabled for later this year, would see part of the government’s 41% share in Jordan Telecom offered on the Dubai International Financial Exchange (DIFX), which opened for business last week. It could also see France Telecom increase its stake in the former monopoly operator, and use it as a vehicle to expand into the Gulf. “There are a lot of financial investors in the region who are interested in getting a stake [in Jordan Telecom],” said Nadia Al Saeed, Jordan’s minister of Information and Communication Technology (ICT). “There is the option of an initial public offering (IPO), not necessarily only in Jordan, but also in another market — Dubai included,” she added. France Telecom, which currently owns a minority stake and management rights in Jordan Telecom, is pushing for a block sale of the government’s 41% holding. This would make the operator a wholly owned subsidiary of the France Telecom Group. But Al Saeed said that one possibility would see part of the operator sold to the French telecoms giant, and the rest offered publicly. “We will be making the decision soon. The whole transaction is supposed to be finished before the end of this year,” she said. The sell-off, which is currently being prepared by Goldman Sachs, forms part of a new wave of initiatives planned for the modernisation of the kingdom’s ICT sector over the coming months. These include the privatisation of nationwide postal service, Jordan Post. According to Al Saeed, the government is reviewing applications by several firms looking to ink a strategic partnership with the company, and expects to make a decision by early next year. “Jordan Post might be wholly [sold off], it depends,” she said. “There has been a lot of interest. We have been approached by international, regional and local companies,” she added. France Telecom’s improved financial position over recent months has freed Jordan Telecom to become more acquisitive in its outlook. Last month, the French group announced its biggest foreign foray for more than four years with the US$8 billion purchase of an 80% stake in Spain’s third-largest mobile network operator, Amena. Countries Jordan Telecom has said it is interested in targeting include Bahrain and Egypt. A listing of the telco’s shares on DIFX would make it the second regional telco to do so. Lebanon-based mobile group, Investcom, said it would perform an IPO in Dubai in early October. The exchange expects to list around 15 IPOs worth US$2 billion over the next 15 months. Companies floating on DIFX are required to offer only 25% of their shares, lower than existing local rules which require 55%.

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