Acquisition of Warid, owned by conglomerate The Abu Dhabi Group, will give the company an opportunity to consolidate its operations in the country, said one banking source.
DUBAI:
Etisalat, the Gulf’s biggest telecommunications operator, has hired Goldman Sachs Group Incorporated to advise on its planned bid for mobile operator Warid Telecom, two sources aware of the matter said.
Warid, the country’s smallest operator, has been put on the block in a sale likely to fetch up to $1 billion, Reuters reported last month. Etisalat and China Mobile, who have existing operations in the country, were seen as potential bidders.
Etisalat, which is also in exclusive talks with Vivendi to buy its 53% stake in Maroc Telecom, has existing operations in Pakistan through its stake in Pakistan Telecommunication Company (PTCL).
Acquisition of Warid, owned by conglomerate The Abu Dhabi Group, will give the company an opportunity to consolidate its operations in the country, said one banking source speaking on the condition of anonymity as the sale process has not been publicly disclosed.
Both Etisalat and Goldman Sachs declined to comment.
Pakistan’s mobile telecommunications sector has five operators and is ripe for consolidation after a period when a troubled economy, increasingly high levels of market penetration and stiff competition has forced companies’ margins lower.
Daniel Ritz, Etisalat’s chief strategy officer, told Reuters on Tuesday the United Arab Emirates (UAE) telecom group would look at opportunities to bolster its existing portfolio without specifying whether the firm was bidding for Warid.
“We will consider ... opportunities in areas where it gives us a chance to consolidate our existing portfolio,” Ritz told Reuters.
Warid launched its cellular services in Pakistan in May 2005 and had 12.54 million subscribers by the end of March this year, down from 17.39 million in 2010-11.
Other operators in Pakistan are Oslo-based Telenor and Orascom Telecom, which operates under the name Mobilink and is the sector leader.
The sellers are being advised by Standard Chartered and Lazard. The Abu Dhabi Group, led by ruling family member Sheikh Nahayan Mabarak alNahayan, has large investments in Pakistan including Bank Alfalah, Al Razi Healthcare and Wateen Telecom.
Published in The Express Tribune, July 26th, 2013.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.
COMMENTS (10)
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ
@Lalai because this isn't happening in Pakistan. The deal is going on in UAE...
@wow: Goldman is providing advice sitting in Dubai! Their interest is making money by providing financial advice to Etisalat in bidding for Warid. Now how did you just assume their interest is Pakistan and that they are planning to open shop here? It's good to be positive but let's be realistic as well.
What about the remaining payment of PTCL?? How can regulator let ETISALAT buy Warid when it already defaulted on said payment?
^^ It's because warid doesn't come with the sort of baggage PTCL came with .......thousands of unionised and ghost employees
They hired Goldman, the great Jewish Bank. Ours hired CM Sind's son to do audit of $5Billion payment to IPPs and RPPs. Shows who is smart here.
Nothing seems to be wrong with the service to the awam. The intense competition has resulted in low tariffs, not a bad thing. Consolidation will probably lead to higher prices. We do not want that.
Is Orscam still running Mobilink?
they are paying USD1b for tiny warid and reluctant to pay 2 billion for giant PTCL ?
Mobilink is now owned fully by Vimplecom Group, No more works under Orescom, please Update your info :)
impressive. Lets hope Goldman will open a branch in Pakistan now.