Zain acquires Iraqi rival for $1.2 billion

Kuwaiti operator enters Iraqi market with acquisition of Iraqna

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By  Ronan Shields Published  December 3, 2007

Zain has purchased Iraqna, one of Iraq's three licensed mobile operators, for $1.2 billion as part of its continued bid to become one of the global top ten operators.

The purchase sees the Kuwait-based network operator take 100% control of Iraqna, a subsidiary of Orascom Telecom Holding, through its Iraqi operator MTC-Atheer.

The expanded MTC-Atheer operation will have the second largest customer base of Zain's 22 operations across the Middle East and Africa, meaning the group now serves more than 43 million customers, according to company representatives.

Ali Al-Dahwi, general manager of MTC-Atheer said: "This is a proud day for Iraq as we integrate Iraqna into MTC-Atheer, creating the country's leading telecommunications operator. The combined strengths and skills of our employees will better serve the people of Iraq, offering essential and high quality mobile services to more communities across the nation."

The acquisition comes four months after both parties paid $1.25 billion to Iraq's Ministry of Communication for 15 year licence concessions in a market of some 27 million people, with a mobile penetration rate of 33% and ARPU of $14.5.

The company also cited the commercial advantages of the transaction as increased cost savings in branding, network sharing and human resources.

The combined entity will re-brand as Zain in early 2008, with group CEO Saad Al Barrak stating that the Iraqna acquisition will make it one of the most dynamic and resourceful mobile telecoms companies in the region.

"This investment reinforces and demonstrates our commitment to the future prosperity of Iraq," he added.

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