The company will initially increase its ownership in Asiacell to 53.9% with any further increase subject to Iraqi government and regulatory approval.
“Asiacell is an outstanding business and has seen excellent performance year on year. The Iraqi market is about to enter a period of rapid broadband and data growth and Asiacell is well positioned to meet the demands of the population for high quality, reliable and affordable voice and data services,” said Sheikj Abdullah Bin Mohammed Bin Saud Al-Thani, chairman of Qtel Group.
Saud-Al-Thani said that the acquisition was in line with Qtel Group’s long-term strategy of active portfolio development by increasing ownership in companies with significant growth potential. He claims that more than 80% of Qtel Group’s revenues are now generated outside of Qatar.
Qtel had expressed an interest in investment company MerchantBridge & Co’s 19% stake in Asiacell in January but it is unclear whether these talks were successful or form part of the latest stake increase.
Years of conflict have left the Iraqi mobile market underdeveloped in comparison to its Middle Eastern neighbours. As a result there is thought to be ample opportunity for growth for the country’s three existing mobile operators.
Asiacell is Iraq’s second ranked mobile operator by subscriber market share, holding 36.6% of subscribers in December 2011. Market leader Zain Iraq had 51.1% market share during the same period, with third ranked Korek Telecom at 12.4% market share.
Qtel said that the transaction will be financed from existing funds.
