Kingdom's due diligence on Zain nearing its end

Dubai: Saudi Arabia's Kingdom Holding said yesterday its consortium with Bahrain Telecommunications, which is bidding for a stake in the Saudi unit of Kuwaiti telco Zain, expects the completion of due diligence on the operator by the end of the month.

"The consortium to purchase Zain Kuwait's stake in Zain Saudi Arabia anticipates completing due diligence by the end of September 2011," Kingdom said in a statement posted on the Tadawul market website.

"The consortium intends to move to complete its proposed acquisition of Zain Saudi based on term sheets signed in April and July of 2011 with Zain Group and Zain Saudi Arabia respectively, as soon as all outstanding conditions are satisfactorily negotiated with all parties concerned."

Batelco and Zain Saudi Arabia couldn't be reached immediately for comment.

Zain KSA said in June it had agreed to open its books to Kingdom and Batelco, which are bidding together for a 25 per cent stake in the mobile firm, a deal worth an estimated $1.2 billion (Dh4.41 billion).

Zain KSA at the time said Batelco and Kingdom would have until the end of August — coinciding with the Eid holiday and the end of Ramadan — to conduct due diligence. Batelco, in a separate statement in June, said it expected the Zain KSA transaction to be finalised by the end of the third quarter.

In July, Zain KSA said it had entered into a non-binding agreement with Kingdom and Batelco relating to the two companies' proposed stake purchase in the Saudi firm.

Kingdom shares yesterday were up 0.7 per cent at 7.40 Saudi riyals (Dh7.25), while Zain KSA traded flat at 6.20 riyals.