(MENAFN - Muscat Daily) Muscat- Omantel is planning to finance the acquisition of a minority stake in Zain Group with a bridge loan facility, the company said on Wednesday.
'Omantel is financing this acquisition with a bridge loan facility which will subsequently be taken out through a long term loan facility and/or capital markets instrument', Omantel said in a filing to the Muscat Securities Market (MSM).
Omantel recently signed a share purchase agreement with Kuwait-based Mobile Telecommunication Co (Zain Group) for the acquisition of 425.7mn treasury shares which form 9.84 per cent of the outstanding common shares of Zain Group for a total consideration of RO325.6mn.
Global ratings agencies Moody's Investors Service and S & P have confirmed Omantel's current ratings post announcement, with Moody's qualifying further the transaction as credit positive.
In accordance with the regulations of Boursa Kuwait, Omantel said the public auction of the treasury shares will take place today. If successful in the auction, Omantel will own 9.84 per cent shares in Zain Group.
Acquiring a minority stake in Zain Group is a deliberate investment for Omantel to position itself as a leading digital service provider.
The acquisition is in line with Omantel's Corporate Strategy 3.0, aiming for growth and diversification.
The acquisition of stake in Zain Group will allow Omantel to gain exposure to nine markets with a total population of 175mn, and provide significant growth drivers across a range of services and applications. Omantel added that the acquisition is expected to improve profitability, leading to enhanced shareholder value.