Investors have reacted glumly to the announcement by Oman’s government of plans to sell a 19% stake in Omantel, causing shares in the telecoms incumbent to fall to a ten-week low, reports Reuters.
Authorities have resurrected a plan to sell shares first unveiled in 2007, when eight operators from Europe, the Middle East and Asia managed to prequalify for the sale.
That process was abandoned in 2008 as a result of the global financial crisis but the government now appears keen to find a buyer of the minority stake, which would still leave Omani authorities with a controlling 51% stake in Omantel (Muscat, Oman).
According to data compiled by Reuters, the 19% stake would be worth about $595 million based on Omantel’s share price on September 16.
As the newswire reports, the operator has recently upped investment activities in an attempt to reclaim ground lost to Nawras (Muscat, Oman), the number-two player owned by Qatari incumbent Ooredoo (Doha, Qatar).
Its aggressive response appears to be paying off, judging by the increase in Omantel’s share of the mobile market, which has risen from 53% in 2009 to 58% at the end of 2012.
Omantel still has a near monopoly in the fixed-line sector, giving it a clear advantage over Nawras when it comes to bundled offers – including both fixed and mobile services – and the use of fixed-line infrastructure for mobile backhaul.