(MENAFN- Muscat Daily) Muscat- Omantel is set to become the second largest shareholder in Kuwaiti Mobile Telecommunications Co (Zain Group) as the company signed a share purchase agreement to buy an additional 12.1 per cent stake in Zain.
Omantel and Al Khair National for Stocks & Real Estate Co, Kuwaiti British Readymix Co and Gulf National Holding Co (sellers) signed a share purchase agreement to sell 521,975,416 ordinary shares or 12.1 per cent of the total fully paid and issued share capital in Zain to Omantel for a total cash consideration of US$1.35bn at an offer price of KWD0.781 per share.
Once this transaction is completed, Omantel will become the second largest shareholder with a total 21.9 per cent stake in Zain after Kuwait's sovereign wealth fund the Kuwait Investment Authority, which currently owns 24.6 per cent of the shares in Zain.
In addition, the board of directors of Zain is expected to be reconstituted. The total transaction value for the 21.9 per cent stake is US$2.19bn, according to a press release issued by Omantel.
Omantel will finance this transaction with a combination of long-term and bridge loan facilities. The bridge loan facility will subsequently be taken out through long-term capital markets instruments.
On August 24 Omantel acquired Zain treasury shares, representing 9.84 per cent of Zain's fully-paid in and issued share capital subsequent to which Omantel chief executive officer Talal al Mamari was appointed non-executive director on Zain's board.
Should the sale of additional 12.1 per cent shares to Omantel be consummated following the public auction, it is contemplated that the board of directors of Zain will be reconstituted to include further representatives of Omantel, the company said in a disclosure filed with the Muscat Securities Market on Thursday.
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