Etisalat Eyes Acquisitions in Syria, Iraq

Dubai Emirates Telecommunications Corporation, or Etisalat, is in a three-pronged expansion plan as it eyes new acquisitions in Syria, Iraq and an increased presence in India.

“The Iraqi government announced it would issue a fourth licence and we expressed our interest,” Etisalat chairman Mohammad Omran said yesterday. “The [Syria] government has announced that it would issue a new licence and we also expressed our interest.” In India, a market in which it has just launched services, Etisalat said it is interested in buying a stake in the country’s No. 2 operator Reliance Communications.

Reliance Communications’ board on Sunday approved selling up to 26 per cent at a premium, and at current market prices, the stake is worth about $2 billion.

“We did not make any offers to Reliance. We’re studying several opportunities in India, among them is Reliance,” Omran said in Amman yesterday.

“India is a large market and we are closest to India. But we’re studying several acquisitions,” he said, citing new licences that will become available in Syria and Iraq.

“We don’t have a liquidity problem,” he said.

Etisalat bought a 45 per cent stake in India’s Swan Telecom, now called Etisalat DB, for $900 million last year. Under Indian law, no entity is allowed to own more than a 10 per cent stake in two or more companies.

“For Etisalat, a potential deal with Reliance Communications for a 26 per cent stake would be affordable if you look at its balance sheet. It can leverage up; this is not an issue at all. The question is about its existing operations. They will need to merge or dispose of [Etisalat DB],” said Irfan Ellam, vice-president of equity research at Al Mal Capital.

Iraq presents significant telecom opportunities. The country needs investments in the range of $50 billion to $75 billion for infrastructure and twice as much for its oilfields.

— With inputs from Reuters

( Gulf News )

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