Dubai (Reuters) Etisalat will cut about three per cent of its staff, aiming to reduce costs as it faces greater competition in domestic markets, the telecoms operator said in remarks published yesterday.

The market leader in the country's telecoms sector will cut at least 300 of 10,460 jobs, the report said, citing etisalat officials.

Faiez Awadh, etisalat's senior vice-president of human resources, said the cuts would be "focused on productivity, performance, age and redundancy factors."

Second largest provider

Etisalat faces rising competition from telecoms provider du, the country's second largest provider, with a market share of 37 per cent at the end of August.

Du's third quarter profits more than doubled last month on strong revenue growth, it said.

Etisalat has been seeking access to high-growth Middle East and African markets, including Iraq and Sudan.

It had been trying to buy a stake in Kuwaiti telecoms carrier Zain, but on Thursday lowered its bid to 40 per cent, from 46 per cent, for $12 billion (Dh44 billion) from a consortium led by Kuwaiti construction and investment company Kharafi Group.

But shareholders outside the consortium and a Zain board member opposed the premium the Kharafi Group would earn from the deal and moved to block it, potentially delaying the acquisition. Etisalat's original offer would have given it a controlling 51 per cent stake.

Cable network

Etihad Etisalat inks deal

Etihad Etisalat Co, Saudi Arabia's second-largest mobile-phone company, signed an agreement in Ankara, Turkey, to develop a regional cable network, Asharq Al Awsat reported, citing Chief Operating Officer Abdulaziz Al Tamimi.

As part of the project, a 7,750-kilometre fibre cable will be built to link the UAE, Saudi Arabia, Jordan, Syria and Turkey and is expected to be operational in the second half of 2011.

Other companies that signed on to the $500 million project with Etihad Etisalat, known as Mobily, included Emirates Telecommunications Corp, the Syrian Telecommunications Establishment, Jordan Telecom Group's unit Orange Jordan, the Mobile Telecommunications Cos Jordanian unit and Mada Group alliance, in addition to Turkcell's fiber-optic network unit Superonline, the newspaper said.