Zain Group eyes regional acquisitions

Telco eyes strategic acquisitions in adjacent businesses
Scott Gegenheimer, CEO, Zain Group.
Scott Gegenheimer, CEO, Zain Group.

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Kuwait’s Zain Group is planning to make selective acquisitions in the MENA region, according to the company’s CEO, Scott Gegenheimer.

The operator, which is present in eight countries in the Middle East and Africa, is open to acquiring mobile operators and “adjacent businesses” such as content companies.

“Are we interested in expanding – absolutely,” Gegenheimer told CommsMEA. “But it has got to make strategic and financial sense, so we are not going to go chasing bids Looking at mobile operators, first I want to make sure they are in our region, MENA. Most of the opportunities are in North Africa.”

Gegenheimer, who took on the group CEO role at Zain in December 2012, said that the acquisition of adjacent businesses could prove an important way of allowing the telco to become an integrated service provider and expand into new services such as triple play and quad play.

“Everyone is moving in that direction,” he said. “Over the next three to five years you will see us move much more into that space. There are a lot of regulatory hurdles but we know everything is moving towards M2M, IP and data. There will be no voice in 5-10 years, it will be 100% data and we want to move in that direction. There are a lot of things to do in fibre, content, m-health, post-sale, all sorts of things.”

This is particularly important in a mobile market that is seeing its core voice and SMS revenue eroded by so-called OTT players, Gegenheimer said.

He added that it was also important for Zain Group to build a ubiquitous platform allowing subscribers to access services “anytime anywhere, on any device”.

By pursuing new revenue streams based on data, Gegenheimer is optimistic that Zain can offset declines in voice and SMS and continue to grow its business. “I think reasonably we can continue to grow our revenues, not necessarily directly from the customer we have today on voice and data, but because of the adjacent businesses and the areas we haven’t explored fully.”

 

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