Kuwait s Zain telecom repays most of its debt

October 14, 2010
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, KUWAIT CITY, Oct 14 – Kuwait\’s Zain telecom has repaid most of its debt following the 10.7 billion dollar sale of its African units, but is still seeking to restructure a "small" debt, a company official has said.

"We have repaid most of our debt and what remains is a small loan but with a high interest rate that we are trying to restructure," Chief Operating Officer Barrak al-Sabeeh told reporters late Wednesday night.

He did not disclose the size of the debt.

Sabeeh said the company is seeking to obtain a revolving facility of 1.5 billion dollars that it can use in part to repay the small debt.

In June, Kuwait\’s largest mobile operator sold its units in 15 African nations to India\’s telecom giant Bharti Airtel for 10.7 billion dollars. Zain said it made a profit close to three billion dollars from the sale.

Zain has said that it used a good part of the sale price to repay debt.

The company said on Wednesday its net profit almost doubled in the third quarter of 2010 while its nine-month profit rose four-fold mainly from returns of its African sale.

Zain posted 80.7 million dinars (286.2 million dollars) in net profit in the three months to September 30 compared to 41.2 million dinars (146.1 million dollars) a year ago, a jump of 95.6 percent, the company said in a statement posted on the Kuwait bourse website.

In the first nine months of 2010, Zain posted a net profit of 976 million dinars (3.46 billion dollars), a 400-percent rise from the corresponding period last year, the statement said.

The amount includes a "capital gain" of 770.3 million dinars (2.73 billion dollars) from returns on the African sale.

Prominent Zain shareholders agreed two weeks ago to a preliminary offer from United Arab Emirate\’s telecom giant Etisalat to purchase a 46 percent stake in a deal worth well above 10 billion dollars.

The two parties are still negotiating details to close the deal expected to be finalised before the year end.

CEO Nabeel bin Salamah told reporters late Wednesday the company management was not involved in the talks.

"Until this moment, we (the board) have not received any thing about the deal. This matter only concerns the shareholders," bin Salamah said.

Zain is the largest of three mobile operators in Kuwait, the other two being the Qatar Telecom-controlled National Telecommunications Co (Wataniya) and Kuwait Telecommunications Co (VIVA), run by Saudi Telecom.

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