Etisalat is in final-stage talks to buy a majority stake in a Middle East telecoms operator this year, the head of international investments at Etisalat said on Sunday.

'This year we are looking at at least one more acquisition. We are planning to buy a stake in a company, it will be a majority stake,' Jamal Al-Jarwan told Reuters by telephone. 'We are in direct talks with this operator, in final
stages,' he said.

Etisalat bought a 45 per cent stake in India's Swan Telecom last week for about $900 million to tap the world's second-largest wireless market. It also said earlier this month it plans to enter the Iraqi market before the end of year.

Jarwan declined to identify the country where Etisalat, the second-largest Arab telecom firm by market value, plans the acquisition or how much it could spend. He said the firm would announce the deal next month.

Like its Gulf Arab peers that are facing stiffening competition in their home market, Etisalat has been expanding aggressively abroad, snapping up assets in countries such as Pakistan and Egypt. It operates in 16 countries.

Mobile penetration in the UAE, which has a population of 4.5 million people, exceeds 150 per cent. Du telecom broke Etisalat's monopoly when it started operations in February 2007.

Saudi Telecom Company and Kuwait's Zain have also been expanding in Africa and Asia.

Etisalat's shares closed 3.11 per cent higher on Sunday, having tumbled 16.15 percent this year to last week's close, underperforming the main stock index, which has declined 15.71 per cent.-Reuters