DUBAI Feb 5 Oman will sell 19 percent of its
former telecommunications monopoly Omantel in two
phases, with the first reserved for wealthy local investors and
due to finish in March and the second open to all Omanis, Omani
The government, which now owns 70 percent of Omantel, in
September announced plans to reduce its holding to 51 percent
through a public share sale, a month later appointing Bank
Muscat as adviser.
Since then, there has been no further official announcement,
but some Muscat newspapers this week quoted Saud bin Nasser al
Shukaily, Secretary-General for Taxation at the Ministry of
Finance, as saying a first phase of the sale would consist of a
private placement for investors buying more than 2 million rials
($5.2 million) worth of shares.
This will be open to major local individual investors and to
institutional investors, and is expected to be completed in
March, Shukaily said. A book-building process will determine the
The second phase would be open to all Omanis. The government
would sell 142.5 million Omantel shares in total; Shukaily did
not say whether a certain proportion of these shares would be
reserved for the second phase.
Foreign investors will not be able to participate in either
phase, but can buy shares on the secondary market.
"The government believes that the current phase of the
Omantel privatisation should be completed over the next eight to
10 weeks," Shukaily was quoted as saying.
Omantel did not respond to requests for comment. Its market
capitalisation is $3.05 billion, according to Reuters data,
making a 19 percent stake worth about $579 million.
Shukaily said the purpose of the share sale was to expand
Omantel's shareholder base and boost market trading as part of a
wider privatisation drive.
"Increasing the free float will be positive for foreign
investors at least in the longer term because it will improve
liquidity in the stock," said Shrouk Diab, NBK Capital's
assistant vice president.
Opting for a public sale is a change in strategy for the
government. In 2007, it said it would offload 25 percent of
Omantel to a strategic investor, prequalifying eight operators
from Europe, Asia and the Middle East for the sale. It postponed
the sale in December 2008, citing the global financial crisis.
Unlike other former monopoly Gulf operators, Omantel has
done little to expand abroad. Its only active foreign unit is
Pakistan's Worldcall, in which Omantel owns a majority stake.
(Reporting by Matt Smith; Editing by Andrew Torchia)