Oman Telecommunications Company (‘Omantel’ or the ‘Company’), the first and leading integrated telecommunications services provider in Oman announces a share purchase agreement (‘SPA’) whereby Omantel will purchase 425.7 million of Mobile Telecommunication Company’s (Zain) treasury shares in a cash transaction at an offer price of KWD 0.60 per share – subject to regulatory approval.

Once complete, Omantel will own a minority stake in Zain Group of approximately 9.84% in outstanding common shares. The total consideration of the transaction is valued at USD 846.1 million (OMR 325.6 million).

Martial Caratti, Chief Financial Officer, Omantel, said: “Acquiring a minority stake in Zain is a deliberate investment for Omantel as we position ourselves as a leading digital service provider. This is in line with our Corporate Strategy 3.0, launched in 2015. We have always emphasised that growth will come from continued diversification, and this acquisition positions Omantel for the future.”

Transaction Benefits

• Positions Omantel as a leading digital service provider. The acquisition of a minority stake is part of Omantel’s Corporate Strategy 3.0 and is in line with the strategic objective of diversifying exposure and positioning the business for future growth.

• Opportunity to cooperate across core business functions.  Omantel will explore ways to cooperate in several key areas including the wholesale telecom business, operations and networks, commercial activities, and knowledge and experience sharing. It will also allow Omantel to gain exposure to nine growth markets with a total population of 175 million, and provide significant growth drivers across a range of services and applications.

• Income diversification and enhanced shareholder value. The acquisition will improve profitability, leading to enhanced shareholder value. Omantel will explore options for cost synergies through operational cooperation and capital expenditure.

• Leverage Zain’s global scale and international expansion. Zain is a high performing and innovative telecoms business with a complementary geographical footprint. It is the most advanced digital service provider in the MENA region with strong partnerships with leading technology players across the globe. It has a fast growing and lucrative portfolio of diversified services which includes data monetization, Enterprise (B2B), fixed broadband/ FTTH services and smart city initiatives.

Credit Suisse are acting as exclusive financial adviser and Freshfields Bruckhaus Deringer LLP are acting as legal adviser to Omantel.