ECONOMY

Etisalat to bid for majority stake in TIM

Emirates Telecommunications Corp (Etisalat) is the first company to state it has tabled a non-binding offer for the acquisition of cellphone network TIM Hellas, following two months of speculation. Mohammed Al Qamzi, CEO of the United Arab Emirates telecom company, stated that his firm is after a stake that will grant Etisalat control of Greece’s third-largest network. «We look at it as a good company and a good operator and it is making good revenues,» Al Qamzi told Reuters. Sources suggest that Etisalat’s adviser is JP Morgan, which was also the main bookrunner for the listing of TIM Hellas in the New York Stock Exchange eight years ago. The main shareholders of TIM Hellas, the private equity companies Apax Partners and Texas Pacific Group (TPG), acquired the firm last year for 1.36 billion euros. So far they have not announced anything about the sale process, and they neither confirm nor refute the rumors about the suitors. However, the international press reports that the process is ongoing, with Morgan Stanley and Lehman Brothers as advisers. Sources further suggest that the price asked for by the two agencies ranges between 3.5 and 4 billion euros. Among the interested parties, according to foreign reports, are the Orascom group of Egyptian entrepreneur Naguib Sawiris, who controls Tellas through Italy’s Wind, as well as other corporations of Arab interests, such as MTC from Kuwait and Oger Telecom from Saudi Arabia. MTC has issued a lukewarm denial of its interest, while Sawiris is undergoing difficult times owing to the huge losses of the stock value of Orascom. Therefore, just as Greek reports are suggesting he is about to purchase TIM Hellas (referring to past statements of his), newspapers in Italy report he may sell Wind. Analysts believe no other business holdings company will express an interest, even though the venture capital market is booming. They add that some strong telecom providers in Europe will stay away from the TIM Hellas bidding because they are examining the option of submitting an offer for state telecom OTE. Etisalat is among the top 500 companies in the world, according to Fortune magazine, with a presence in Saudi Arabia, Pakistan, Sudan and other Central African states. In the year’s first nine months it had revenues of $494.1 million (a 26 percent rise per year), while pretax profits grew by 36 percent.