Mobily in talks to buy stake in Atheeb

JEDDAH: Saudi Arabia’s No.2 mobile company Etihad Etisalat (Mobily) is in talks to buy a stake in loss-making fixed-line operator Etihad Atheeb, according to a statement on the Kingdom’s bourse.
The two firms have entered non-binding talks for a Mobily subsidiary to buy a stake in Atheeb, according to the statement, which sets a June 30 deadline to announce "relevant developments".
This did not state what size stake Mobily was seeking or who the potential sellers are.
Bahrain Telecommuni-cations Co. (Batelco) owns 15 percent of Atheeb, Atheeb Trading Company holds 16.4 percent and Al-Nahla Group has a 13.9 percent stake, with 49 percent of shares publicly traded.
Mobily, a subsidiary of the UAE’s Etisalat does not have a fixed-line license and acquired data provider Bayanat Al-Oula for SR 1.5 billion ($ 399.98 million) in 2008 to offer fixed-line Internet services.
It signed a Memorandum of Understanding with Atheeb, which operates under the brand name Go, in December to offer fixed-line calls.
Mobily’s Chief Executive Khalid Al-Kaf told Reuters in January that this would soon become a formal partnership, with his company becoming a re-seller for Atheeb’s estimated 2 million lines.
Atheeb, which a made a net loss of SR 274.1 million in the financial year ending March 31.
The firm cut its capital to SR 400 million from SR 1 billion in 2011 to offset some of its accumulated losses, as per Saudi bourse rules. It then completed a SR 1.18 billion rights issue the following year. Mobily, Batelco and Atheeb were not immediately available for comment.