Etisalat-PTCL deal back on

After almost two months of discussions the privatisation of PTCL is on course with Etisalat given five years to pay for the 26% stake.

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By  Alex Ritman Published  December 22, 2005

The deal between Etisalat and Pakistan Telecommunication Co Ltd (PTCL) is back on track, with the UAE operator saying it has been given five years to pay for the 26% stake in the Pakistani incumbent. “There were several pending issues. Part of the deal between us and the Pakistani government was to pay part of the amount over the next five years,” says Etisalat CEO Mohamed Hassan Omran, adding that an Etisalat team would fly out to Pakistan next week to finalise the deal. Etisalat agreed to pay US$2.6 billion for the stake, but missed the October 28 deadline set. Since then there have been emergency meetings between Etisalat and senior Pakistani government officials in an attempt to salvage the privatisation, the largest in Pakistan’s history. Far above second-placed China Mobile’s US$1.4 billion offer, many have viewed Etisalat’s bid as too high. With falling revenues and share prices at PTCL since the offer, it is likely that the Pakistani government realised a second auction was unlikely to raise nearly as much money. While Etisalat may want to turn PTCL into a more efficient operator, it has the company’s 56,000 employees to contend with. Before the auction took place in July, workers began protests about job security, leading to a ruling that guaranteed their positions for two years.

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