Kuwait’s Zain hopes to keep the reins at Bahrain unit

The Kuwaiti telecoms operator Zain said it aims to keep a controlling stake in its Bahrain operation as it seeks to list 15 per cent of the unit before the end of the year.
According to the licence rules, Zain Bahrain must list its shares on the Bahraini bourse within 10 years of acquiring the permit.
Zain currently holds 56.3 per cent of the Bahraini unit, according to its financial statement.
"We prefer to have controlling stakes in all of our operations. We don't really want to have minority stakes anywhere," said Scott Gegenheimer, the Zain Group chief executive.
"Procedure-wise, we have most of the clearances that we need. It's more about the timing. We have already appointed the lawyers, investment bankers, the underwriters – so most of the work has already been done. It's about making sure that the roadshow is finishing up. We will be able to launch it on time," he added.
Zain Bahrain, which started its operations in December 2003, ended the monopoly of Bahrain Telecommunications, or Batelco.
Mr Gegenheimer also expressed interest in raising Zain's stake in its Moroccan unit Inwi, without providing a timeline for the increase.
"It's [Inwi] a very interesting operation. It fits into our footprint quite well, so we would like to increase our ownership. But there are no active discussions right now," he said.
Mr Gegenheimer expressed his interest in expanding into North Africa, saying the Zain brand "fits really well in it".
"We are looking for areas to expand. There are a lot more opportunities in North Africa than somewhere else. We are not expecting to go to Asia or outside of the Mena region. So I think the brand carries out quite well there," he said.
In 2010, Zain sold its African operations to India's telecoms operator Bharti Airtel in a deal worth US$9 billion. The deal marked an end to an aggressive phase of acquisitions by the telecoms company. It also symbolised a change in the company's strategy, which currently seeks to focus on its existing operations.
Mr Gegenheimer said that Zain is targeting to become an integrated service provider, one that offers mobile, fixed-line, TV and internet services for all its operations. This could lead the company to make a number of acquisitions in the future.
"If you look at all of our operations, every one of them is a pure mobile operator. We need to change that," said Mr Gegenheimer.
"There are ISPs [internet service providers] in all of our markets, so we need to look at them and see how they can integrate with us."
Commenting on its Jordanian operations, Mr Gegenheimer said that a tax increase in the country is hurting revenue.
Recently overall effective taxes on telecoms in Jordan rose from 30 to 44 per cent.
"We have fractured [the taxes] in our pricing, so if you buy a scratch card for instance, it would include our incremental taxes. But in effect, people are buying less because they are paying more in taxes. It is actually affecting us," he said.
selgazzar@thenational.ae