Etisalat’s attempt to buy a stake in Zain has failed
Etisalat’s attempt to buy a stake in Kuwaiti rival Zain for $12 billion has failed according various sources.
The deal’s architect walked away, National Investments Co. (NIC), the investment firm owned by Zain’s major shareholder Kharafi Group, on Tuesday said its commitment to sell a 46 percent stake to UAE’s Etisalat was over.
Statement issued on the Kuwaiti bourse website after market hours today proves that the deal has failed.
The deal was announced in Sept. 29. A due diligence deadline of February 28 expired without comment from either Zain or Etisalat. A key regulatory requirement for Etisalat’s deal to go ahead – the sale of Zain’s stake in affiliate Zain Saudi – was already in doubt after Zain turned down three bids for the stake in late February.
Last week, Etisalat said it would complete bank financing and due diligence for the planned acquisition of Zain by the end of February.
CNBC Arabiya quoted informed sources as saying Etisalat had said it would like the selling parties to extend the deadline for due diligence.
NIC shares ended 7.1 percent lower, while Zain fell 1.5 percent on the Kuwait bourse prior to the announcement. Etisalat dropped 0.5 percent on the Abu Dhabi bourse.
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