DUBAI Nov 10 Oman Telecommunications Co.
OTL.OM (Omantel) will seek shareholder approval to serve as a
guarantor to obtain funding for struggling Pakistani unit
Worldcall (WCTL.KA), the company said on Wednesday.
Worldcall has requested $70 million in funding for capital
expenditure and meet liabilities but was unable to independently
obtain the required financing, Omantel said in a statement.
Omantel's board of directors will raise the issue of
stepping in as a guarantor to obtain the financing at a planned
extraordinary general meeting.
Omantel took a 56.8 percent stake in Pakistani diversified
telecom operator Worldcall in 2008 as part of its strategy for
international expansion. The $193 million deal marks its biggest
foreign investment so far.
But the subsidiary came under pressure due to the global
financial crisis and price wars that weighed on margins.
In 2009, Omantel sought to inject $50 million into the
struggling unit. [ID:nLC470835]
Last week, Omantel reported third-quarter profit declined 33
percent, falling short of analysts' estimates, as expenses rose.
(Reporting by Shaheen Pasha; Editing by Amran Abocar)