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Etisalat's $12 Billion Bid for Zain Close to Collapse

02 марта 2011

The US$12 billion takeover bid by UAE based Etisalat for Kuwait's Zain has been dealt a serious blow after a major shareholder announced that it had ended talks with Etisalat.

The Kharafi Group, which had lead the shareholder group supporting the sale said in a statement to the Kuwait Stock Exchange that its subsidiary company, NIC, had terminated its commitment to sell its shares to Etisalat.

"Due to the expiration of the deadline given to Etisalat for the completion of due diligence of Zain, which was identified by the end of February, we declare an end to this under our commitment contained in us and Etisalat for the sale of 46 per cent of the capital of Zain," said NIC.

The Kharafi directly owns 12.7% of Zain, but its subsidiaries take its holdings up to around 20 percent. The Kuwait Investment Authority, the country's sovereign wealth fund, is Zain's largest shareholder with 24.6 percent of the company.

As some 10 percent of Zain shares are held as treasury stock, Etisalat would gain effective control of the company with just 46% of the shares.

The deal had been cast in to doubt last week when Zain rejected the three offers for its 25% stake in its Saudi Arabian subsidiary - the sale of which was essential for the sale to go ahead.

Источник: Cellular news

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