How Kuwait Telecom Merger Streamlines the Future?

How Kuwait Telecom Merger Streamlines the Future?

In the Gulf region, state-backed telecom operators are teaming up to create a shared space for their mobile towers through a three-way partnership deal. This collaboration involves Qatar’s Ooredoo (ORDS.QA) and Kuwait’s Zain (ZAIN.KW), forming a regional powerhouse managed by Zain-backed TASC Towers Holding. With an estimated enterprise value of $2.2 billion, the new entity will oversee a portfolio of approximately 30,000 towers across countries like Algeria, Tunisia, Iraq, and Jordan. Ownership stakes will be divided, with $8.9 billion Ooredoo and $6.9 billion Zain holding 49.3% each, while the remaining share goes to TASC.

The agreement, finalized 15 months after Ooredoo initially announced plans to sell its towers, marks a strategic move for both telecom giants. Ooredoo is set to offload approximately 20,000 towers, receiving cash from Zain to equalize their respective ownership stakes. However, Zain’s payment of around $73,000 per tower is 9.5% less than the average price observed in prior tower deals, according to JPMorgan analysts. Furthermore, Zain, as the major shareholder in Dubai’s TASC Towers Holding, will take the lead in managing the newly formed entity.

Despite the terms favoring Zain in this telecom merger, the deal provides Ooredoo with the opportunity to retain a significant share of any improvements in the performance of the towers. For Ooredoo, which had previously missed out on certain dealmaking opportunities, this partial exit represents a strategic move toward maximizing value and participating in the evolving telecom landscape.

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John Smith

John Smith is a distinguished journalist, holding a Master's in Journalism from the renowned Columbia University. With a knack for uncovering the most captivating stories, John is the go-to expert for all things related to politics and current affairs. His insightful analysis and commitment to unbiased reporting set him apart in the world of journalism. John's writing ensures you're always in the know about the latest happenings in the USA.

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