Etisalat likely to allow foreigners to own shares

Abu Dhabi: The UAE's Etisalat may allow foreign shareholding but is awaiting the government's approval to modify legislation, the corporation's chief said.

"Etisalat has its own Act and this needs to be modified before allowing foreigners to own shares. We are talking to the government to modify the Act and some other issues," Mohamad Hassan Omran, Chairman and Chief Executive, told Gulf News yesterday.

"Once the Act is modified and passed, that would then allow us to go to the shareholders and decide on allowing foreigners own shares in Etisalat."

The modification of the Act is crucial before gaining shareholders or ministerial approval, he said.

Analysts said Etisalat's move to divest its shareholding is a natural move assuming the second telecom operator in the UAE would also offer shares to foreigners.

"Usually telecom operators attract the attention of foreigners and I would think Etisalat would attract high interest from foreigners especially because it is now not just a local company, but an international one," said Daniyah Darwish, Telecoms Analyst at Cairo-based EFG-Hermes.

"Etisalat has ambitious expansion plans internationally and of course foreigners would be interested in its shares."

Etisalat has ventured into several foreign markets such as Saudi Arabia, Pakistan and some African countries. It is also bidding for a licence in Egypt and is looking at some European and Asian markets.

"It would be good if Etisalat opens its shareholding to foreigners because it is today known internationally," said Yaser Al Gendi, Manager at National Financial Brokerage Company.

"It sure will create huge demand because it is a good stock and the company itself has a good track record."

Etisalat, on Sunday secured approval from shareholders to double its authorised capital to Dh8 billion.