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Zain board approves opening books to Etisalat

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CIOL Bureau
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KUWAIT: Kuwaiti telecom Zain confirmed on Monday its board of directors has approved opening the company's books for due diligence by UAE's Etisalat, which has offered to buy 46 percent of the company.

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"The board of directors has approved the start of the due diligence," Zain said in a statement to the Kuwaiti bourse on Monday.

The firm added that selling Zain's Saudi unit is one of the deal's conditions.

A source close to the deal told Reuters on Sunday the board had given its nod to the due diligence process to start.

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Etisalat, the Gulf's second largest telecoms group, offered in September offered to buy a 46 percent stake in Zain for 1.7 dinars ($6.07) a share, in a deal worth just under $12 billion. The buyer said on Wednesday it was making any deal dependent on the sale of Zain's Saudi assets.

Last month, Kharafi Group, one of Zain's major shareholders, said it gathered enough approvals from shareholders to tender to Etisalat's 46 percent stake sale bid.

Kharafi Group, a family conglomerate, owns a 12.7 percent stake in Zain, but analysts estimate Kharafi's stake to be around 20 percent through other firms it controls.

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The group asked National Investments Co (NIC), which it owns, to secure the rest of the shareholder support required for the deal.

On Monday, NIC said in a newspaper advertisement carried by Kuwaiti daily al-Qabas, that it will start accepting requests from Zain's investors that own up to 300,000 shares in the telecoms firm, to join the stake sale to Etisalat.

NIC will start receiving the requests through the Kuwaiti bourse clearing company from Nov. 10 to Nov. 30, the ad said.

Zain, the Gulf Arab region's third-biggest telecoms firm, sold its African assets this year but still operates in high-growth Middle Eastern markets such as Iraq and Lebanon, among others.

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