Orange Group eyes stake in Korek Telecom

French incumbent plans to enter Iraqi market, according to FT report

Tags: France Telecom-Orange groupKorek TelecomMergers and acquisitions
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Orange Group eyes stake in Korek Telecom Many operators are assessing the Iraqi market as a source of potential growth.
By Staff Writer Published  November 25, 2010

France’s incumbent telecoms operator, Orange Group, is considering buying a stake in Iraq’s third largest mobile operator, Korek Telecom, according to a report from the Financial Times, which cited sources familiar with the situation.

The report indicated that the deal under consideration could give Korek Telecom an enterprise value of $1.5 billion, and added that Orange Group is interested in eventually gaining a controlling stake in the Iraqi telco.

Stephane Richard, CEO, Orange Group, said earlier in the year that the group may invest as much as US$9.3 billion over the next five years in the Middle East and Africa.

Orange, which also owns Jordan’s incumbent telecoms operator, launched an operation in Tunisia in May, and also opened a research and development centre in the Ivory Coast earlier this month.

Korek Telecom, was established in the north of Iraq in 2000, and was awarded one of Iraq’s three national licenses in Iraq in 2007, along with Zain and Asiacell.

Korek is currently the smallest of Iraq’s three mobile operators, with a market share of about 10%, according to Josep Moya, a partner at Delta Partners, a Dubai-based telecoms consultancy. Moya estimates that Zain has a market share of about 54% in Iraq, and Asiacell the remaining 36%.

Iraq is widely viewed as one of the region’s most promising telecoms markets, with a population of some 30 million people, and a mobile penetration rate of about 70%.

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