Wataniya Q3 Profits Down 69%

Wataniya, Kuwait's second largest mobile phone operator by subscribers has reported a 69% drop in net profit for the three months ending 30 June 2010.

The company made a net profit of KWD19.6 million (USD68.32 million) during Q2 2010, down from KWD63.5 million one year earlier. Net profit in 1H10 was reported at KWD35.8 million, down from KWD78.8 million in the first half of 2009.

Wataniya, itself a unit of Qatar Telecom (Qtel, which will publish its Q2 results on Sunday), operates in markets including Algeria, Tunisia, Saudi Arabia and the Maldives.

We Are Not Talking With Zain, Says Etisalat

UAE telecoms operator Etisalat has said it has not submitted a bid or made a proposal to purchase a stake in Kuwait-based Zain Group, cellular-news reports.

The statement followed a recent report from Kuwaiti newspaper al-Seyassah, which said that Zain had entered into talks to sell a majority stake in the group to Etisalat.

Earlier this month Zain's chief executive, Nabeel bin Salama, said the firm was not in talks to sell further assets, after it completed the sale of its African assets to Indian telecoms group Bharti Airtel, in a deal valued at USD10.7 billion.

Zain In Talks To Sell sTake to Etisalat

Kuwaiti telecoms firm Zain Group has entered into talks with Etisalat to sell a majority stake in the group to the UAE-based operator, Reuters reports, citing Kuwaiti newspaper al-Seyassah.

Without providing details about the size of the stake or the price, the report states that both firms held meetings last week to discuss the potential deal.

Earlier this month Zain completed the sale of its African assets to Indian telecoms group Bharti Airtel, in a deal valued at USD10.7 billion.

Meanwhile, though Etisalat has yet to confirm the Zain reports, the Abu Dhabi-based operator has admitted it is looking at options in India, including a 26% stake in telco Reliance Communications.

Bharti To Invest USD100 In Malawi Expansion Plan

Indian telecoms group Bharti Airtel has said it will spend USD100 million on network expansion in Malawi over the next three years, news agency Reuters reports. Earlier this month Bharti finalised the acquisition of the African assets of Kuwait-based Zain Group, in a deal valued at USD10.7 billion. The company has taken over Zain’s operations in 15 countries, including Malawi, Burkina Faso, Ghana, Kenya, Nigeria, Sierra Leone and Uganda.

The Indian company expects to introduce the Airtel brand across its new units by October 2010.

‘We plan to invest USD100 million in Malawi in the next three years to improve coverage and reach out to Malawi's rural farmers ... and help the country's economy grow,’ chief executive officer of Bharti Africa, Manoj Kohli, told a news conference. Kohli added that Bharti plans to increase the number of its subscribers in Malawi from the current 2.5 million to seven million, although no date has been given for the company to reach its target.

Bharti Raises USD8.3Billion For Zain Stake

India's Bharti Airtel has announced that it has raised funding totaling USD8.3 billion for its proposed acquisition of the African assets of Kuwaiti telecoms group Zain, according to Bloomberg Business Week.
Bharti will receive USD7.5 billion via loans from a group of banks led by Standard Chartered and Barclays, and the development comes hot on the heels of reports that Bharti's board had approved the planned purchase earlier this week. Exclusive negotiations between Zain and Bharti are scheduled to conclude by 25 March.

Bharti CEO Says Africa Has Potential

While explaining the rationale for buying Zain, Africa was described as a potential emerging market by Sunil Bharti Mittal, founder Chairman and Group CEO, Bharti Enterprises.


The need of globalisation for Bharti has also been explained by him as Indian operations were generating free cash flows. While defending his decision to enter into talks with the Kuwait telecom major, he made it clear that competitive intensity is low for Zain in most countries and the valuations offered are fair and reasonable.

According to Bharti officials, Africa had good growth opportunities among emerging markets, given its high population, lower mobile penetration and relatively less competition and the tariffs too, in Africa are more than 10 times India.

Zain, Bharti To Sign Letter of Intent

A letter of intent (LoI) will be signed between Bharti Airtel and Zain for the proposed USD 10.7-billion deal for the African assets of the Kuwait-based firm by the end of this week.
An exclusive talk is carried out between the two companies till March 25 for the proposed deal as per which Bharti would buy Zain’s African assets except those in Morocco and Sudan.
USD 9 billion for the assets would be paid by Bharti and the rest would be towards the debt of the Kuwaiti firm.

Zain Denies Reports on Sale of African Networks

­Kuwait's Zain has refuted local media reports that it had been contacted regarding a sale of its African assets. The Al Anbaa newspaper had reported that Zain was in talks with Vivendi, France Telecom and Vodafone offer a possible sale of the former Celtel networks.

In a statement to the stock exchange, Zain said "There are no current offers and the company will inform the bourse's administration with any new information that may come up regarding this issue,"

The paper, citing unnamed sources said that Zain had been in talks with the other operators for the past couple of months and is seeking US$11-US$12 billion for the networks.

Vivendi was in talks last year to buy the African networks, for a reported US$12 billion - although those talks then broke down. At the time it was suggested that the sale could have been an all-share based transaction, with Zain taking 20 percent of Vivendi, in exchange for 10 percent of Zain Africa.

For its part, Vodafone recently increased its holdings in South Africa based Vodacom to 65%. A merger of the former Celtel, Vodafone and Vodacom assets across Africa could lead to much needed consolidation in several markets.

Celtel was founded by Sudanese-born Mo Ibrahim in 1998 and sold to Kuwiat's MTC (now Zain) in April 2005 for US$3.4 billion.

Zain Denies It's In Talks With Asian Group

* Zain says unaware of stake sale talks after report

* Shares close 1.6 percent higher

Kuwaiti telecoms firm Zain said on Sunday it was not aware of talks between shareholders and an Asian group after a newspaper reported stake sale negotiations.

The firm said in July that it was still reviewing a possible sale of its African operations -- excluding Morocco and Sudan -- after French media and telecoms conglomerate Vivendi broke off talks on buying the operations.

Kuwait's Al-Rai newspaper, citing unidentified sources, said on Sunday that Zain's largest shareholders were in talks with a major Asian telecoms group to sell more than 40 percent of the firm.

"Zain would like to clarify that regarding what has been published in a local newspaper about negotiations between a major Asian group and shareholders, the executive management of the company is not aware of this subject, which is up to shareholders," Zain said in a statement on the bourse website.

Sovereign wealth fund Kuwait Investment Authority owns 24.61 percent of Zain. Kuwaiti family-owned conglomerate Kharafi Group is Zain's second largest shareholder, with 13.3 percent.

Neither KIA nor Kharafi were immediately available for comment. A Zain spokesman declined to comment further.

Zain ended 1.6 percent higher on the bourse on Sunday.

"There is an enormous amount of rumours about Zain," said Naser al-Nafisi, general manager at Al Joman Center for Economic consultancy in Kuwait. "If there's anything going on between the shareholders, the management should know about it."

The newspaper, which did not identify the Asian group, cited unidentified sources as saying that the biggest shareholders in Zain had "the ability and the suitable mechanism to provide the required majority stake".

Sale talk has swirled around Zain in recent weeks.

The head of the international unit of Emirates Telecommunications Corp (Etisalat) said in July that the UAE firm was interested in buying a 51-percent stake in Zain, "given the right values".

Zain said on July 1 that it was working with Swiss investment bank UBS and other consultants to review its strategy as a result of the global financial downturn.

- Reuters

KIA Willing to Sell off Its Stake in Zain

Kuwait Investment Authority (KIA), the Gulf state's sovereign wealth fund, could consider selling its stake in mobile operator Zain if the price is right, newspaper al-Rai said on Monday.

KIA, which owns a 24.61 percent stake in Zain, has not received any offers from Etisalat, to date, the paper added.

"The KIA has no objection to discussing any offer to buy its stake in Zain whether made by the UAE's Etisalat or others under the condition that the offer would be serious and with attractive returns," daily Rai said, citing unnamed sources.

KIA could not immediately be reached for comment.

Last week, Etisalat, or the Emirates Telecommunications Corp, said it has not made an offer to buy Zain or its African assets after the head of Etisalat's international unit told Reuters earlier that it was interested in buying a 51-percent stake in Zain Group, "given the right values."

The Kuwaiti firm has been in the news for the past weeks after it said it is still reviewing a possible sale of its African operations -- excluding Morocco and Sudan -- after French media and telecoms conglomerate Vivendi broke off talks on buying the operations.

KIA, which manages the OPEC member state's massive oil-generated assets, sold its 19.8 percent stake in Islamic lender Boubyan Bank in an auction last week.

Kuwait's finance minister, Mustapha al-Shamali, said earlier this month the KIA may sell further stakes in local companies through an auction process.

Zain Reports 5.5% Raise in Q2 Profits

Kuwaiti mobile operator Zain, the third-largest Arab telecoms firm by market value, posted a 5.5 percent rise in second-quarter net profit as the number of subscribers rose. Net profit in the first half was 154.5 million dinars ($538.3 million), Zain said in a statement on Tuesday, without giving a quarterly figure.

Reuters calculated a second-quarter net profit of 78.8 million dinars based on previous financial data, which showed the firm made 75.7 million dinars in the first quarter. The number of customers rose 37 percent to 69.5 million in the first half, the statement said.

Zain said revenues in the six months to June 30 rose 24.1 percent to 1.16 billion dinars compared with the same period last year, and EBITDA advanced 46.3 percent to 512.2 million dinars. It gave no quarterly data.

First-half results include a gain of 26.6 million dinars from an initial public offering in Zambia and losses from currency fluctuations of 31.3 million dinars, Chief Executive Saad al-Barrak said in the statement.

"With improving currency stability in many of our African operations we expect even better in the second half," he added.

Zain announced at the start of the year a goal of 30 percent net profit growth but a spokesman reiterated on Tuesday this target looked "a little bit ambitious".

Emirates Telecommunications Corp (Etisalat) is interested in buying a 51 percent stake in Kuwait's Zain Group at the right price, the chief executive of its international unit said on Tuesday.

Zain, which is partly owned by the country's sovereign wealth fund, said on Monday it still hoped to sell its African unit despite French media and telecoms giant Vivendi calling off talks to buy a majority stake in the business.

Zain has spent billions to expand in the Middle East and Africa and operates in 23 countries to offset rising competition at home in Kuwait where VIVA, an affiliate of Saudi Telecom (), started operating as third mobile firm last year.

- Reuters

Zain Launches Borderless Roaming for Data Services

Mobile operator Zain has launched cross-border data services across the Middle East and East Africa on its One Network platform. The GRX-based data access is provided to Zain customers roaming in other markets where the company is active and provides for data use at the local country rate. The One Network already offers local pricing for voice and SMS, with no charges for incoming calls while roaming on another Zain network.

Customers can also top-up using local country vouchers. The new data services include internet, e-mail, MMS, BlackBerry service and Zain portals, such as the recently launched Zain Create platform.

The Middle East countries that benefit from this data service are Bahrain, Jordan, Iraq, Kuwait, Saudi Arabia and Sudan, while in East Africa the countries are Kenya, Tanzania and Uganda.

By the end of 2009 all other African One Network countries will join and benefit from this data service. Customers do not have to pre-register for the data access service, move to a special tariff, change their handset settings or pay any subscription fees for One Network. 

Zain Begins Lay-offs In Nigeria, Uganda

The Zain Group - a mobile communications firm with operations in Africa and the Middle East – has started laying off at least 2,000 employees from all its subsidiaries, with its entities in Nigeria and Uganda announcing the lay-offs of 300 and 27 employess, respectively.

This follows the Group’s decision to sack the lot as it strives to position itself in the premier league of world’s top 10 telecommunications firms.

The decision emerged at a strategic meeting with senior Zain executives from all 22 African and Middle East operations, in Bahrain last week.

Zain’s new wave of layoffs will particularly affect its head offices and operations structures across all markets. Until Monday, the Group directly employed 15,500 workers. The reduction of its workforce by 2,000 will represent a loss of 13 percent in its human resource departments.

Zain Nigeria in a statement announced it was laying off 300 of its staff, an action aimed at aligning its business model with the Zain group's growth strategy. Mr Yesse Oenga, the managing director Zain Uganda, said 27 workers will be sacked from their jobs in the country.

In March, 141 staff at Zain Kenya were laid off. Other markets that have already sacked workers include; Iraq, Jordan, Kuwait, Malawi and Sierra Leone.

Zain Group Chief Executive Officer Dr Saad Al Barrak who announced the layoffs – the single largest in Africa so far, said the layoffs are part of the firm’s Drive2011 – a new programme aimed at propelling the company towards its 2011 target with 150 million subscribers and $6 billion in revenue.

In Uganda, the termination of workers to re-align Zain’s operations begun yesterday, according to Mr Oenga. Zain’s staff downsizing process forms part of its new drive to improve service delivery to its customers in all operations, according to Mr Oenga. 

Specifically, Zain Nigeria said it was joining operations across Africa and the Middle East to implement the new business model, Drive2011, which is part of Zai n 's drive to become a top 10 global mobile operator by 2011 with 150 million cust o mers and earnings before interest, taxes, depreciation and amortisation of US$6 b illion.

Zain has invested more than US$12 billion in Africa since 2005, with a plan to m ake further investments of up to US$2 billion this year.

Zain to Cut Down on 2,000 Jobs, Plans to Outsource More Functions

Zain has announced that it is cutting some 2,000 jobs as it streamlines its operations and increases the outsourcing some back office/non-core functions to strategic partners. The project, Drive2011 is expected to improve Zain’s operating margin by 5% within 12 months.

The Zain Group will align its head office and operations structures in accordance with the new operating model. This will result in Zain reducing its current 15,500 global workforce by 2,000 - a 13% reduction across the board. Zain operations in Iraq, Jordan, Kenya, Kuwait, Malawi and Sierra Leone have already begun the process.

“Drive2011 is a natural consequence of Zain’s evolutionary journey. It was planned soon after the launch of our ACE strategy in 2007 and is a structured and timetabled approach to maximizing efficiency,” declared Zain Group CEO Dr Saad Al Barrak. “We will create genuine market differentiation through our services and deliver on our Zain brand promise of ‘A wonderful world’. This will be achieved through a combination of managed outsourcing, centralization and leveraging capabilities, as well as training and development for our personnel, all of which will improve our operating efficiencies.”

In a move aimed at tackling the challenges ahead and attaining other 2011 targets of 150 million customers and a US$6 billion EBITDA, Dr Al Barrak also announced several senior management changes at both Group and country operation level.