Zain Saudi Arabia, a subsidiary of Kuwait’s Zain, expects to proceed with a US$577m capital increase in June through either a rights issue or a debt-to-equity conversion, according to the company’s chief executive officer (CEO).
The company, which is the…
Zain Saudi Arabia, a subsidiary of Kuwait’s Zain, expects to proceed with a US$577m capital increase in June through either a rights issue or a debt-to-equity conversion, according to the company’s chief executive officer (CEO).
The company, which is the holder of the kingdom’s third mobile phone licence, wants to increase its capital after it broke its banking commitments on a US$2.6bn Islamic loan in February.
Zain Saudi Arabia has yet to decide whether to convert some of its debt or raise fresh shares from its equity investors, said Saad al-Barrak, the company’s CEO, at a press conference in Kuwait on 19 May.
“It is under study, under consideration. We hope to finalise it within a month,” said Al-Barrak. “We don’t really have the final picture. We are discussing with the CMA (Capital Market Authority) and hope that in June we should be able to reach a final conclusion,” he added.
Zain Saudi Arabia lost SR663m (US$177m) in the first three months of this year. It generated revenues of SR1.1bn for the quarter, up 88% compared with the first quarter of 2009.
The company has been saddled with debt since Al-Barrak, then the CEO of Zain Group, agreed to bid US$6.1bn for the licence to operate in the kingdom back in 2007.
