Zain seals deal for Paltel
Mobile operator Zain has completed a share swap deal for Paltel that will see it take control of Palestine’s only mobile operator
Mobile operator Zain has completed a share swap deal for Paltel that will see it take control of Palestine’s only mobile operator.
Zain will take a majority interest in incumbent operator Paltel with an equity shareholding of 56%, in exchange for Paltel taking 100% ownership of Zain Jordan.
Zain CEO Dr Saad Al Barrak, said that the merger would allow for synergies between the two operators in neighbouring Jordan and Palestine, with “substantial value for shareholders”.
“We have enduring faith in the Palestinian economy and are totally committed to future development of its telecom sector. This deal will play an instrumental role in supporting our 2011 ambitions of being a top-ten global mobile operator,” he said in a statement.
The mobile division of Paltel, known as Jawwal, will be rebranded to Zain by the end of 2009, and it will become the 19th country to join Zain’s ‘One Network’.
Paltel has a base of 1.5 million active mobile customers and over 363,000 fixed line customers, as well as approx 78,000 ADSL customers.
Zain expects the combination of Zain Jordan and Paltel to produce a business group which will generate US$1 billion of revenues, US$450m in EBITDA and US$300 million in net income in 2009.
Paltel, which was established in 1997, has a dominant position in the market without any official competitor, although some Israeli operators provide services that ‘leak’ across the border.
A second operator, Wataniya, was awarded a licence to operate in Palestine in 2006. Last year, Wataniya CEO Scott Gegenheimer said he expected to launch in “early” 2009.