Omantel to buy 65pc of Pakistan's Worldcall
Muscat, August 12, 2007
Oman Telecommunications Co. (Omantel) expects to conclude a deal to buy 65 percent of Pakistan's Worldcall by the end of the month, its chief executive said on Sunday.
The deal, which would allow Omantel to gain a foothold in the world's third-fastest growing telecom market, would be worth 9.43 billion rupees ($156 million) at the stock's closing price of 19.3 rupees on Friday.
Omantel initially expected to conclude the purchase of a majority stake in the wireless local loop operator in June. It has never given the size of the stake or said how much it would pay. "It is a 65 percent stake," chief executive Mohammed Al-Wohaibi told Reuters by telephone.
"We expect to conclude the deal before the end of the month. There were procedural delays, we are just waiting for the necessary approvals."
Shares of Worldcall, which also offers long distance telephone services, have almost doubled in value this year.
Omantel, the country's second-largest company by market value, is bracing for the end of its fixed-line monopoly this year, two years after the government opened the mobile business to competition.
About 65 percent of Oman's 2.5 million residents have mobile phones compared with about 33 percent in Pakistan, with a population of 160 million, Shuaa Capital telecom analyst Marc Hammoud said in June.
"The Oman market is very small and we are facing competition," Wohaibi said.
Other telecom operators in the world's biggest oil-exporting region have targeted Pakistan as part of expansion plans.
Emirates Telecommunications Corp. bought a 26 percent stake in Pakistan Telecommunications Co. Ltd. for $2.6 billion in 2005. Qatar Telecommunications Co., which operates Oman's second mobile phone operator Nawras, took over Pakistan's Burraq Telecom this year with a Saudi partner.
State-controlled Omantel, which reported its second straight record quarterly profit in the second quarter, plans to compete in a group with Belgacom for Qatar's second mobile phone licence, Wohaibi said.
Omantel shares are down about 3.1 percent this year, underperforming the index by more than 18 percent. - Reuters