Zain confirms takeover offer

Kuwait's Zain telecom has confirmed it has received an offer for its operations in 15 African nations.

Kuwaiti telecommunications operator Zain has confirmed that is has received an offer to buy its operation in Africa in a deal worth as much as US$10.7 billion (Dh39.3bn) The sale, if it goes ahead, will be be one of the largest cross-border deals in the Middle East and mark a significant turning point Zain's ongoning disposal plan. "Zain has received an offer in relation to its operations in Africa excluding Morocco and Sudan," the company said in a statement on its website. Zain, the third largest telecomes operatior in the region, said that its board of directors will be discussing the offer today at 12:30 pm Kuwaiti time. Trading in Zain's shares on the Kuwaiti bourse was halted until a decision has been made on the offer, the company said. Yesterday, Al-Rai, the Kuwaiti newspaper, said that Indian operator Bharti Airtel offered $10.7bn to buy Zain's African units, except in Sudan. In a research note, Shuaa Capital telecoms analyst Simon Simonian said that Bharti Airtel would be a credible potential suiter for Zain's African units. "The Indian operator attempted twice to acquire MTN Group, and has been looking to expand in Africa," said Mr Simonian, who raised his rating on Zain to "buy" from "sell". Zain probably would pay a special dividend to shareholders if the African unit would be sold, Mr Simonian said. "We assumed Zain divests a 65 per cent stake in the African unit. As was the case during the discussions with Vivendi, Zain was interested to maintain a minority interest in the African unit, as well as a management contract for the first two years." On Thursday, Zain announced it had appointed Nabil bin Salama (CQ) as the new chief executive of the company, to be effective today. Mr bin Salama served in 2009 as Kuwait's Minister of Communication, Water and Electricity, following several years in the public sector. He replaces Saad al Barrak who led the telecoms operator since 2002. [e-mail]