A serious blow has been dealt to an $11 billion bid by Etisalat for a controlling stake in Kuwaiti telecoms firm Zain today.
The Kharafi Group, a Kuwaiti conglomerate leading the deal has announced it has ended negotiations with the UAE operator.
In a statement to the Kuwait Stock Exchange, the National Investments Company (NIC), a brokerage firm that is majority-owned by the Kharafi Group, said that it has ended its commitment to sell the Zain stake to Etisalat.
"Due to the expiration of the deadline given to Etisalat for the completion of due diligence of Zain, which was identified by the end of February, we declare an end to this under our commitment contained in us and Etisalat for the sale of 46 per cent of the capital of Zain," said NIC.
An Etisalat spokeswoman declined to comment.
Last week the likelihood of success grew more remote after a top executive and shareholder of Zain said the deal would not happen.
Sheikh Khalifa Ali Al Sabah, a member of Zain's board of directors, a shareholder in the company and a member of Kuwait's ruling family, said the absence of a buyer for the company's Saudi unit meant the Etisalat deal could not proceed.