Batelco, KHC abandon Zain Saudi deal

29 Sep 2011

According to Reuters, Bahrain Telecommunications (Batelco) and Kingdom Holdings Company (KHC) have pulled out of the long-running deal to buy 25% of Zain Saudi Arabia for USD950 million, announcing that the proposed terms could not be met. As previously reported by TeleGeography’s CommsUpdate, on 14 March Zain accepted a joint offer for its 25% stake in Zain Saudi Arabia from Batelco and Saudi billionaire Prince Alwaleed bin Talal’s investment vehicle, KHC. However, the transaction has been plagued with problems from the outset, most recently a Kuwaiti court declared Zain’s annual shareholder meeting – which was held in April 2011 – invalid, finding the telecoms giant guilty of a number of violations, including: failing to record shareholders’ objections to the Zain Saudi Arabia deal, and ‘stopping some shareholders from entering, locking the doors’. A joint statement issued by Batelco and KHC read: ‘The consortium concluded that the terms and conditions as set out in its non binding offer could not be met to its satisfaction’. Although the reasons for the deal’s collapse have not been made public, analysts have speculated that Zain Saudi Arabia’s rumoured USD5.5 billion debt proved to be the major stumbling block.

Saudi Arabia, Bahrain Telecommunications Company (Batelco), Zain Group, Zain Saudi Arabia