Batelco and KHC on track to acquire Zain KSA

Deal is "progressing well" and could be completed in July, says Batelco CEO
Kaliaropoulos is optimistic that the deal will be completed within two or three months from the start of due diligence.
Kaliaropoulos is optimistic that the deal will be completed within two or three months from the start of due diligence.

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Batelco Group and Kingdom Holding Company’s plan to buy a 25% stake in Zain KSA from Zain Group is progressing well and a binding agreement could be reached by around July 22, according to Peter Kaliaropoulos, CEO, Batelco Group.

The CEO said that Batelco and KHC were due to give a presentation to Zain KSA’s board of directors and other interested parties on May 16 to explain their plans for the company.

“We will share with them [Zain KSA board] what we plan to do with the company from a marketing and operational point of view, how we are going to fund the acquisition and what would the benefits be for the other 75% of share holders who are staying in the company,” Kaliaropoulos told CommsMEA.

However, the CEO added that while Zain Kuwait had provided Batelco and KHC with some information necessary for due diligence, the consortium was still waiting for official approval from Zain KSA for access to important information.

“Although we had full approvals of Zain Kuwait we still had to negotiate with Zain KSA for access to information, the management teams and so on.

“The due diligence process is such that we have to take a very close look into Zain KSA and unless we are satisfied ourselves with information about the company then the due diligence cannot be completed,” Kaliaropoulos said.

However, he added that while Batelco had not yet received confirmation that the information would be released, there had been speculation that Zain KSA was ready to formally approve due diligence.

Kaliaropoulos said he expected due diligence to start around May 22, and that a binding offer could be accepted by the respective boards about two months later.

“We are optimistic because at the end of the day we put a proposition together which is good for Zain Kuwait who are selling, and which is, we believe, good for the Zain KSA shareholders,” Kaliaropoulos said.

“It is not just a matter of us buying this share from Zain Kuwait and sitting there as financial investors. We are willing to inject working capital, we will inject a number of new initiatives to help the company grow.”

Zain Group said on April 7 it had signed a term sheet agreement with Batelco and Kingdom Holding to sell its stake in Zain Saudi Arabia. Zain Group accepted a non-binding offer from Batelco and KHC to acquire its 25% stake in Zain Saudi Arabia in March.

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