Batelco has called off its sale of Jordanian business Umniah, CEO Ihab Hinnawi was cited saying. He added that the company could in fact make acquisitions in its existing markets.
Batelco (BSE:BATELCO) has called off its sale of Jordanian business Umniah, CEO Ihab Hinnawi was cited saying. He added that the company could in fact make acquisitions in its existing markets.
Speaking to Reuters, he said: “We’re going to terminate the sale process. It’s not an optimal time to sell, it’s an optimal time to buy. Prices are reducing, the appetite of so many big players is declining and many are over-leveraged.”
The Bahraini incumbent had received non-binding bids for the subsidiary in January, with final offers expected in mid-February. The process was being run by Citi. Observers had seen Saudi Arabia’s STC (TASI:STC) as the most likely buyer.
Announcing FY 2015 results last week, Batelco said Umniah continued to perform well due to its strategy of “offering high quality services, with the best value, while keeping abreast with sector developments and customers’ various needs and expectations”.
For Q4 2015, it reported 3.2 million Jordanian mobile subscribers, a 15% year-on-year increase and 9% increase on the previous quarter. Umniah competes with Zain, Orange and a clutch of MVNOs.
Jordan has a population of 8.1 million, according to the CIA, which noted that the figure includes an estimated number of Syrian refugees.
Other markets
Batelco is present in 14 markets, with those outside Bahrain contributing 59% of revenues and 55% of EBITDA in FY 2015.
In Saudi Arabia, where Batelco owns 15% of fixed-line challenger Atheeb Etihad, Hinnawi said the company needed to gain a foothold in mobile. In FY 2015, Batelco recorded an impairment of BD3.1m (US$8.2m), and saw subscribers decline by 13% year-on-year.
“Keeping Atheeb in its current structure is not good for us. We need to change the model, get an LTE licence and spectrum or we exit,” he noted.
Incumbent STC is the leading provider of fixed and mobile services, while Etisalat-owned Mobily and Zain are the next largest cellcos.
In Yemen, despite the civil war, Batelco could consider upping its 27% stake in local operator Sabafon, said Hinnawi. Although the unit’s subscriber numbers had fallen by 20% during the year, he noted that the country was home to a young population, and had yet to upgrade to 3G.
“There are huge opportunities and we may think to up our stake,” Hinnawi was quoted saying.
At group level, the company reaped gross revenues of BD372.4m (US$987.8m), a decrease of 4% year-on-year, and an EBITDA of BD137.9m (US$365.8m), a decrease of 5% year-on-year and representing a margin of 37%.