* UAE telco says made preliminary expression of interest
* Vivendi selling majority stake partly to cut debt
* Qtel, Korea Telecom also eyeing Maroc stake-sources
(Recasts, adds details)
By Matt Smith
DUBAI, Jan 17 Abu Dhabi's Etisalat is
interested in buying Vivendi's 53 percent stake in
Morocco's top telecom operator, potentially resuming foreign
expansion that appeared over with its withdrawal from key Asian
markets last year.
The Gulf's No.2 operator by market value has submitted a
"preliminary expression of interest" for the stake in Maroc
Telecom, worth around $5.8 billion at the current
market price, a statement to its local bourse on Thursday said.
French conglomerate Vivendi is exploring selling several
assets including Maroc Telecom to pay down debt, boost a
flagging share price and reduce the group's exposure to
capital-intensive telecom businesses.
"The Moroccan market is relatively stable, with not much
movement in terms of market share and Maroc Telecom is also the
market leader, which would be important for Etisalat," said
Abhinav Purohit, an analyst at consultants IDC.
"The Morocco regulator has spoken of launching LTE
(next-generation network) services and Maroc Telecom is the best
placed to benefit from that because it has the best network,
which should reinforce its position as market leader."
In early December, Etisalat's chief executive Ahmad Julfar
said his company was not bidding for Maroc Telecom.
That seemed consistent with a push to scale back foreign
operations after quitting India following a licence scandal and
selling most of its stake in Indonesia's PT XL Axiata
Etisalat had 12.2 billion UAE dirhams ($3.3 billion)of cash
and cash equivalents on its balance sheet as of Sept. 30.
"The general belief in the market was that they wouldn't be
interested in the stake - this comes as a surprise and looks
like there has been a change of mind at the top," said a
Gulf-based banking source who declined to be identified.
"For Vivendi, interest by another Gulf telco is a positive
sign. This kind of an asset is better in the hands of a Gulf
operator as they understand the markets and the politics of
Vivendi was not immediately available for comment.
Maroc Telecom offers fixed-line, mobile and internet
services at home and is also a major African telecom operator
with units in Burkina Faso, Gabon, Mali and Mauritania.
State-owned Qatar Telecom has hired J.P. Morgan
to advise on a potential bid for the stake, sources told
Reuters in December, while South Korea's KT Corp is also said to
be weighing an offer.
Vivendi hopes to get 5.5 billion euros ($7.31 billion) for
its Maroc stake.
Etisalat's announcement is its first public approach for a
foreign company since a $12 billion bid for a controlling stake
in Kuwait's Zain failed two years ago.
Since then, the operator has overhauled management,
appointing Julfar as chief executive and new heads of finance
and strategy with an apparent focus away from overseas forays
which failed to add much to the bottom line.
Etisalat, which operates in about 15 countries in the Middle
East, Asia and Africa, spent around $12.6 billion between 2004
and 2009 buying companies, licences and other investments
abroad, according to Reuters calculations.
But the UAE still provides most of its revenue and Etisalat
is fighting back against rival domestic operator du,
which has built up a 47 percent share of the country's mobile
subscribers since ending Etisalat's monopoly in 2007.
Vivendi's shares were up 1.3 percent at 1203 GMT in Paris
while Maroc stock was 2.5 percent ahead.
Separately on Thursday, BTG Pactual Group, Latin
America's largest investment bank, has pulled out from the race
to acquire GVT SA, Vivendi's Brazil-based telecom unit, a
($1 = 3.6730 UAE dirhams)
(Additional reporting by Dinesh Nair; Editing by Hans-Juergen
Peters and David Cowell)