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Abu Dhabi, UAEMonday 24 September 2018

Oman postpones third mobile licence award

Omantel's acquisition of Zain stake and Qatar dispute blamed for delay

Zain stocks surged on news of an acquisition deal by Omantel. Razan Alzayani / The National
Zain stocks surged on news of an acquisition deal by Omantel. Razan Alzayani / The National

Oman’s telecoms regulator has postponed the award of the country’s third mobile licence, being sought by some of the region’s top telecoms operators, as a recent acquisition of a stake in Kuwait-headquartered Zain by Omantel has complicated the process.

The country’s Telecommunications Regulatory Authority (TRA) was due to announce the winning bidder for the third licence on September 4 for the first new mobile entrant in the Arabian Gulf since 2010. Regional operators such as the UAE's Etisalat, Saudi Telecom, Sudan’s Sudatel Group and Zain itself had all submitted bids for the licence.

The regulator however has delayed the licensing process by nearly three months, a senior GCC-based telecoms executive told The National, adding that the TRA has already informed the interested parties about the postponement.

“The award has been delayed to November 30, according to official communication,” said the executive, who asked not to be named.

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The TRA is studying the implications of Omantel's acquisition of a 10 per cent stake in Zain, the executive said.

The regulator was due to announce a shortlist of qualified bidders last month, but is believed not to have done so, according to the executive.

Omantel, the biggest telecoms operator in the country, last month announced the US$846 million acquisition of the minority stake in Zain. It is the largest overseas acquisition by the Omani telco by some distance, raising questions at the time about whether Zain would be permitted to continue its bid for the third licence.

Zain declined to comment. The TRA could not be reached for a comment.

The political and economic dispute between Qatar and its Arabian Gulf neighbours could be another factor that had “complicated things,” according to the telecom official, who declined to give further details.

Qatar’s Ooredoo launched Oman’s second mobile operator in 2004 branded as ‘Nawras’, breaking the monopoly of Omantel, which is still majority owned by the government.

The UAE, Saudi Arabia, Bahrain and Egypt on June 5 broke diplomatic ties with Qatar and cut off air, sea and land access to the country over Doha’s support for “terrorist groups aiming to destabilise the region”.

Oman has, so far, not joined its neighbours in cutting ties with Qatar, with economic links between the two countries reported to have strengthened since the diplomatic standoff escalated three months ago.

The tender for Oman’s third operating licence, launched last November, will be the first “greenfield” telecoms opportunity to be offered in the Arabian Gulf since the award of Bahrain’s third mobile license to Saudi Telecom in 2009.

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