* Zain to IPO 15 pct of Bahraini unit
* IPO priced at 0.19 dinars per share
* Subscription during Sept 2-16
(Adds details, background, analyst comment)
By Nadia Saleem
DUBAI, Aug 4 Kuwait-based telecommunications
provider Zain will launch its long-awaited initial
public offering (IPO) of its Bahraini unit next month, it said
on Monday, in what would be the first listing on the kingdom's
bourse since 2010.
The subscription period for the IPO will run from September
2 to September 16, with shares priced at 0.19 dinars ($0.50)
each, Zain said in a stock market filing in Kuwait, adding the
offering was open to retail investors in Bahrain as well as
institutional investors in the Gulf region.
Nearly all the cash raised from the offering of 15 percent
of the firm - equivalent to 48 million shares - will be used to
fund upgrades of its network infrastructure as well as expand
its 4G LTE offering in the kingdom, a separate document stated.
The investment banking units of Gulf International Bank and
National Bank of Kuwait will run the offering, with
the former also acting as underwriter.
Zain Bahrain's IPO will be the first in the Gulf Arab
country since Aluminium Bahrain listed 10 percent in
The kingdom's bourse suffers from poor liquidity, which
makes it unattractive to companies to list. Trading activity on
Bahrain's exchange is the lowest in the region with just 827.9
million shares traded during 2014 so far, compared to 85.5
billion traded on Dubai's bourse over the same time period.
Since its listing, Aluminium Bahrain's share price has
fallen by more than half.
However, like in many Middle Eastern countries, Zain must
list part of its operations in Bahrain as part of its licence
agreement signed in 2003.
An IPO had originally been mooted in 2008 but the global
financial crisis pushed the plans back until Bahrain's
Telecommunication Regulatory Authority (TRA) instructed Zain
last April to complete the sale by the end of 2013.
While this deadline passed, moves began earlier this year to
get the floatation underway.
"This is something they are doing because of license
requirements," said Cairo-based Omar Maher, an equity analyst at
EFG-Hermes. "Bahrain is a small operation and a small IPO and,
for Zain as a parent company, the proceeds will have little
impact on their financial results."
Zain Bahrain, 63 percent owned by parent Zain, competes with
former monopoly Batelco and the local unit of Saudi
Zain also plans to list its Iraqi unit, which could raise
more than $1 billion, but the IPO has been delayed twice and the
current political tensions in the country make it difficult to
see when it will finally go ahead.
($1 = 0.3770 Bahraini Dinars)
(Additional Reporting by Noura Al Sharif; Editing by David