“We are keen to conclude this deal as soon as possible but given the nature of the legal formalities it will not go beyond three months,” Peter Kaliaropoulos Batelco Group Chief Executive told a Press conference on Thursday.
“We have already received acceptance of the non-binding offer made in collaboration with Kingdom Holding Company to acquire 25% of Zain KSA, from the board of directors of Zain Kuwait and are proceeding with the process of due diligence,” he said.
Talking about the possible source of funding Kaliaropoulos said that Batelco with $175 million in cash in banks and zero-debt balance sheet would raise up to $1.2 billion without any difficulty.
“Batelco remain focused on cash management and our cash balance of $175 million grew by 10% year on year. We remain debt free and in a sound position to raise funds for future expansion.”
At this stage, he added, Batelco intends to raise funds between $800 million to $850 million from the market to fund the proposed bid. Talking about the banks and financial institutions he said that there would be a combination of regional and international banks and financial institutions. “Most probably it will be a consortium of three financial institutions as Batelco has got green signal from the financial institutions about the funds,” he added.
Referring to the losses or decline in profitability in first quarter he said that much expected recurring losses from the STel India and tough market conditions in Bahrain were largely responsible for the losses in Q1 of 2011.
“The losses from the STel India will continue for next three years as part of our projections before it starts paying off. The losses in Q1 were less than the projected figure from our operations at STel,” he said.
Apart from Zain KSA, the Group CEO said that Batelco would remain open to any opportunity to invest which in return can add value to the investor’s money. “Batelco never faced any financial issue but we don’t invest in the business which won’t pay back and this careful selection of investment targets some time it takes much longer time,” he added.