Etisalat sells stake in Saudi affiliate Mobily
UAE telecom operator says its holding has dropped to 26.25% from 35%, as required by its licence.
UAE telecom Etisalat said on Monday it had sold part of its stake in Saudi affiliate Etihad Etislat (Mobily) as required by its licence.
Etisalat's holding in the firm was now 26.25% compared with 35%, it said in a statement on the Abu Dhabi bourse website.
"It is required that the founders of Mobily should sell 20% of the shares of the company... in the course of the third year after inception," Etisalat said
Mobily chief executive told Reuters in February Etisalat, which owns a 35% stake in the Saudi firm, would offer to sell 20% of the company to local and foreign investors.
Six Saudi institutional investors including the state-run Public Pension Agency and the General Organisation for Social Insurance (GOSI) have held 45% of the firm's shares.
Once the sale by founding shareholders is completed, the company will raise its capital by 40% to 7 billion riyals ($1.87 billion), Mobily said in February.
It will issue 200 million new shares at 10 riyals each, with founding shareholders taking 60% of the new shares.
Mobily, one of two mobile telephone service providers operating in country of 24 million people, started operations in mid-2005. It has since claimed a 40% market share.
Its 2007 profit almost doubled to 1.38 billion riyals as sales grew 44.3% to 8.44 billion riyals.
Mobily and its rival Saudi Telecom Company will face new competition this year when a consortium led by Kuwait's Zain starts operating a a third mobile network in the kingdom. (Reuters)