UPDATE 1-Zain Iraq working on launch of IPO - CEO

* IPO a requirement of licence agreement

* Communications body says Zain unlikely to meet Aug deadline

Jun 19 (Reuters) - (Adds details, CEO quote, regulator comments)

By Serena Chaudhry

BAGHDAD, June 19 (Reuters) - The Iraqi unit of Kuwaiti telecoms company Zain plans to launch an initial public offering (IPO) on the Iraq Stock Exchange, its chief executive told Reuters on Sunday.

Emad Makiya, CEO of Iraq's biggest mobile phone operator, said the firm was working on the listing and hoped to meet the August deadline set out in its licence operating agreement.

"We are working on this process. The process for the listing is long. We hope that we can meet the deadline," Makiya told Reuters. "This is a part of the licence requirement and we're going to fulfil it."

Iraq did not have a mobile phone market under the rule of Saddam Hussein but the industry has boomed since the 2003 U.S.-led invasion that toppled him.

Zain, along with rivals AsiaCell, partly owned by Qatar Telecommunications and Korek, in which France Telecom and Kuwaiti logistics group Agility have a stake, all secured $1.25 billion licences in 2007 to operate in Iraq for 15 years.

Listing on the local bourse by August 2011 was a requirement in their contracts.

However, Ahmed Alomary, the commissioner of Iraq's Communications and Media Commission (CMC) which regulates the industry, said it was unlikely the three firms would list on the stock exchange in time.

Alomary told Reuters there would be another process to impose any penalties.

The CMC fined Zain $262 million in January for putting 5 million Sim cards in the local market without permission, contravening its licence. The firm was previously fined $18.6 million in 2009 for poor service.

Kuwait Arabic daily al-Qabas reported on Sunday the Zain IPO was expected to value a 20 percent stake at $80 million. Makiya said it was too premature to place a value. (Editing by Patrick Markey and David Hulmes)