UAE-based telecommunications company Etisalat (News - Alert) will be moving forward with investor meetings next month for what may be the company’s first public debt offering.
Abu Dhabi Securities Exchange was notified this week by the telco that it has organized a number of investor meetings for Sunday June 1 in UAE as well as Europe and Asia. Deutsche Bank, Goldman Sachs International, Royal Bank of Scotland, and HSBC are thought to be involved in the arranging of the meetings too, according to the Khaleej Times.
Analysts have been expecting Etisalat to issue bonds for a number of months, even though the company just spent $5.65bn for the acquisition of a 53 percent stake in Maroc Telecom in Morocco, a stake purchased from Vivendi (News - Alert) SA.
Meanwhile, Etisalat is facing strong competition from fellow UAE company du Telecom. Etisalat is expected to allow competition over fixed-line telecommunications services in the UAE, giving du a rare opportunity to unseat Etisalat from its dominant share of the market.
The network sharing talks have been on-going since 2009 with little or no end in sight but now Reuters (News - Alert) reports the deal should be in action by the end of 2014.
Currently Etisalat’s penetration rate for fixed lines in the UAE is 25 percent while for broadband Internet services, the figure is 12 percent.
The company has been experiencing a downturn in the fixed line telecoms business in recent years, which it attributes to the rise in VoIP services. This is considered the cause for the business drop rather than solely competition from du says Etisalat.
“Competition from du has been a less significant factor in the level of fixed-line Arpu [average revenue per user] as du only has fixed-line operations in a limited number of regions within the UAE,” according to Etisalat’s bond prospectus.
Edited by Maurice Nagle