Oman looks to sell 25% telecoms stake
Oman is looking to sell a 25 per cent stake in Oman Telecommunications Company to a strategic investor as the Gulf state seeks to develop its domestic infrastructure and expand its international operations.
The finance ministry, which will announce the sale on Monday, hopes to raise a premium to the $1.1bn market value of the stake as it pushes ahead with its privatisation process. The government floated 30 per cent of the company to the public in 2005.
Oman, which only has modest oil and gas reserves compared with its Gulf neighbours, hopes to spark interest from a large telecoms company. It hopes that the fast-growing economy, which has benefited from the oil-price spike but is diversifying into sectors such as tourism as it prepares for the post-oil era, will attract potential suitors.
The government wants to tap the expertise of a strategic partner as OmanTel looks overseas, reversing its previously conservative approach to international expansion, according to Darwish al-Bulushi, secretary-general of the finance ministry. The process started in February when OmanTel bought a 65 per cent stake in Worldcall, a mobile broadband operator in Pakistan.
“You can’t just think of your home market, you have to go out and compete – this is the role of the strategic partner to help the company grow at home and abroad,” Mr al-Bulushi told the Financial Times in an interview.
The sale, with Citi as lead adviser, should be completed in the fourth quarter.
Oman hopes the 25 per cent stake will stir interest from Asian, European and other Middle Eastern operators.
Regional operators such as Etisalat of the United Arab Emirates and Kuwait’s Zain have entered Saudi Arabia, while the UK’s Vodafone last year joined a local consortium to pay $2.1bn for a second mobile licence for wealthy, but tiny, gas-rich Qatar.
Oman’s mobile penetration, at 96 per cent of the population of 2.5m, is below the average 137 per cent of its Gulf neighbours.