Zain Saudi Arabia's operating licence has been extended by 15 years, following a notification from the Kingdom’s Communications and Information Technology Commission, (CITC). The renewed licence will now expire in January 2047.
CITC has allowed Zain KSA and other Saudi-licensed telecom companies to obtain a unified telecommunication licence that supports both service-neutrality and technology neutrality, allowing the company to provide all telecommunication services using appropriate technologies within approved frequency bands.
During the 15 year extension period Zain KSA will pay an annual fee equivalent to 5% of net profits at that time. The overall financial impact of the extension is expected to benefit Zain KSA’s annual amortisation by approximately SAR 433 million (US $115 million) per annum.
HH Prince Naif bin Sultan bin Mohammed bin Saud Al Kabeer, Chairman of the Board of Directors of Zain Saudi Arabia said: "This is clearly the most significant development for the company since inception. This decision aligns with the Kingdom’s “Vision 2030”, to diversify the economy and to significantly increase the contribution from private sector companies. As the third mobile operator we have a crucial role to play in the economic transformation of the Kingdom, our role is to benefit all citizens of the Kingdom through bringing innovation and change to our industry. Only through effective competition will this occur. To play our role effectively, the Kingdom needs us to be strong. Therefore on behalf of Zain Saudi Arabia and its shareholders, I sincerely thank our government for their vision and leadership in reaching this decision.”
Hassan Kabbani, CEO, Zain Saudi Arabia said: “I would like to join our Chairman in thanking the government for their support. This is a landmark decision that will accelerate the transformation of the company.”
Kabbani added that the company will enter discussions with the Ministry of Finance to discuss alternatives regarding the dues to the government. “This is very positive news for the company and for the telecommunications industry in Saudi Arabia. This decision brings our goal of reaching sustainable net profits significantly closer.”