Zain increases stake in Iraq mobile operation

Operator gains management control of Iraqi operation

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By  Roger Field Published  November 4, 2008

Kuwait-based operator Zain has more than doubled its stake in Zain Iraq to 62% from its previous holding of 30%, for $34.47 million. Zain completed the deal by exercising a pre-agreed call option between Zain and the owners of Athir National (Bahrain), which is one of the three founders of Zain Iraq.

Dr Saad Al Barrak, CEO, Zain Group, said the deal was important in that it gave Zain management control of Zain Iraq.

“An essential part of Zain’s profitable expansion strategy in being a top-ten global mobile operator by 2011 is to have either majority ownership or management control. This deal in turning an affiliate company to a fully fledged subsidiary company seals both requirements and was achieved on the back of our recent $ 4.5 billion capital increase,” Al Barrak said.

“We have taken this step due to our enduring faith and trust in the future of Iraq and the enormous potential of its telecommunications industry. We are confident this increased shareholding will positively impact Zain Group’s future financial results in many facets.”

Zain Iraq is one of the leading mobile operators in Iraq with more 8.5 million subscribers. The company has been providing mobile services in Iraq since December 2003, previously under the name of MTC-Atheer.

Zain acquired a 15-year nationwide licence for $1.25 billion in August 2007, before acquiring Iraqna for $1.2 billion in December 2007. On 5th January, 2008 Zain Group merged Atheer with Iraqna under the new brand name Zain.

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