ABU DHABI: UAE telecom operator Etisalat said Sunday it has stretched the deadline for its proposal to buy a majority stake in Kuwaiti Zain after not completing its due diligence on time.
"The parties do continue to work towards the announcement of a definitive transaction," said Etisalat in a statement released in Abu Dhabi.
Etisalat had said in November that its purchase proposal would terminate by January 15 if the two parties fail to enter a definitive transaction by the date.
"The parties have not made sufficient progress towards completion of the Proposed Transaction in order to meet that deadline due to unforeseeable delays in Zain providing access to all relevant information which is required for Etisalat to complete its due diligence process," it said.
Stakeholders will be informed about the progress "in due course," the statement said, without setting a new deadline.
A Kuwait court last month authorized Zain to open its books for due diligence to Etisalat, throwing out an objecting lawsuit by a leading stakeholder in the Kuwaiti operator, Al-Fawares Holding.
It had objected on the grounds that an official purchase offer from Etisalat was not seen.
Al-Fawares, believed to own about five percent in Zain, also demanded that the Kuwaiti company should not be allowed to sell off its Saudi unit, a precondition for the Etisalat deal.
In September, Etisalat said it had submitted an offer to the Khorafi Group, the largest shareholder in Zain, to buy a majority stake for about 12 billion dollars.
Khorafi Group has a direct stake of 12.7 percent in Zain and an estimated indirect stake of at least seven percent. It is expected to collect the remaining shares needed for the deal from other stakeholders.
Etisalat, the second-biggest Gulf telecoms provider by market value, said in November it had signed a preliminary accord with Khorafi to buy 51 percent of Zain shares traded on the Kuwait Stock Exchange at 1.7 dinars (6.1 dollars) per share.
