Home / / Zain shareholders vote to lift ownership cap

Zain shareholders vote to lift ownership cap

Confirmed: three operators in talks for Zain’s African assets, as Vivendi says discussions are “over”

Zain shareholders vote to lift ownership cap
Zain chief executive Saad al-Barrak (L) and chairman Asad al-Banwan, address the media in Kuwait City on 31st August 2009.

Zain's shareholders yesterday voted to scrap limits on the individual ownership of shares in the operator, paving the way for a partial takeover of the group.

Zain CEO Saad Al-Barrak and chairman Assad Al-Banwan said that so far the Kuwait-based firm had not received any offers to sell a stake in the company, Reuters reported.

However, other shareholders may decide to sell their stake in the firm. The largest shareholder is sovereign wealth fund the Kuwait Investment Authority (KIA), with a 24.6% stake. Private investor the Kharafi Group has a 10.8% share.

A senior consultant and former advisor to the Zain group, who did not want to be named, told CommsMEA: "[the sale] is coming from Kharafi, and KIA is very interested in it now. Kharafi would like to see a return on the investment, whether that is because of cash flow pressures and other elements of the Kharafi empire, or whether it's the souk mentality and you buy and then you sell in a three or four year time frame, I'm not really sure."

Al-Barrak confirmed to reporters that Zain is in preliminary talks with three operators over the sale of some of its African assets, with Indian telecom firm Reliance thought to be one of the interested parties.

French media firm Vivendi, one of the first companies to express an interest in Zain, today put an end to any speculation that it would acquire any of the Kuwait-based telcos African assets.

In July, Vivendi announced that talks had been suspended and today CEO Jean-Bernard Levy confirmed the company was no longer working on a deal.

"The Zain dossier is over. We do not intend to pay more than what it is worth," Levy told reporters during a conference call to discuss Vivendi's second quarter results.

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