Dubai: Emirates Telecommunications (etisalat) plans to borrow more than $9 billion (Dh33 billion) to buy shares in Mobile Telecommunications, three bankers familiar with the deal said.
The financing to acquire a stake in Zain, as the Kuwaiti phone company is known, would be the largest acquisition loan by a company in the Middle East and Africa since at least 1999, according to data compiled by Bloomberg. It may take the form of a short-term bridge loan that will be replaced with longer-term financing, said the bankers, who declined to be identified as the discussions are private.
Etisalat started talks with banks to finance the deal, Al Bayan reported yesterday, citing Chief Operating Officer Salem Al Sharhan. Jamal Al Jarwan, chief executive officer of etisalat's international investments department, couldn't be reached for comment.
The Abu Dhabi-based company will take out loans, sell international bonds or a combination, according to the report in Al Bayan which didn't identify lenders.
Etisalat won't need fin-ancing from the government, according to the newspaper.
Etisalat last month offered to buy 46 per cent of Zain in a deal valuing the company at about $11 billion.
National Bank of Kuwait SAK, adviser to etisalat on the acquisition, is expected to take a role in arranging the debt, one of the bankers said.
The deal would give etisalat majority control of Zain and extend its reach in the Middle East, where Zain operates in countries from Kuwait and Iraq to Bahrain.
Etisalat offers telecommunications services in 18 countries in the Middle East, Africa and Asia, counting more than 100 million customers, according to its website.
The UAE's seven emirates make up about 86 per cent of etisalat's sales.
