Telenor is ready to buy 63 percent shares in Warid Telecom, Pakistan against USD 1.3 billion, as confirmed by sources close to the deal.
Dhabi Group will retain 7 percent shares in the company, while other 30 percent are with Singtel.
Warid’s spokesperson has not authenticated this news, while Telenor said that they don’t comment on rumors or speculations.
As per our sources, that are multiple in number, said that whole talks went through in a smooth way, especially when Telenor agreed on paying the value that was pretty acceptable for Dhabi Group. Final discussions went through last week in Abu Dhabi when Telenor’s top management was there to finalize the matters.
Sources further confirmed that buyout will remain under cover until certain requirements are met, including clearance of liabilities and certain amount of expense cut in Waird. Hard one, but a fact can be certain job cuts in Warid in next 2 weeks.
It merits mentioning here that Singtel had tried buying remaining 70 percent stakes in Warid, back in July 2009, however, deal couldn’t close then due to value differences.
Story is developing, stay tuned for more information and analysis on this.
Update: Sources at PTA have communicated us that they are aware of the situation, however, approval hasn’t been asked by Telenor or Warid, as of now. PTA will approve the application with no objection.
Update 2: As more details are coming in, it is learned that takeover will happen in next two months. Telenor Pakistan and Telenor Asia heads were present in the talks with Dhabi Group – Irfan Wahab was also seen in Islamabad last week, hence it is anticipated that he played decisive role too.
As mentioned above, Warid will have to settle its liabilities, especially those with franchisers and publishers. Sources further communicated us that Warid may shed its workforce too.
It was further revealed that both Warid and Telenor will keep working with their brand identities, and no merger in operations will happen. However, Telenor will takeover the control of company – that means it will appoint its own senior management. We are also told that Telenor has chosen the next CEO of Warid, and he is non-English.
All this means that distributors/franchisers need not to worry about the takeover, as their operations will keep rolling the way they are. Instead, their long awaited commissions/payouts are supposed to be released in near future. (but according to new formulas, derived by management last month).
This takeover will also affect those operations where Warid, Wateen or Bank AlFalah were working in collaboration. For instance, Warid’s those cell sites, that incorporated Wateen’s WiMAX boosters may have to re-sign the contracts. In such cases, cell site land owners may get additional rent due to existence of two signaling transmitters. By the way, majority of Warid Cell Site owners are not paid for Wateen’s transmitters.
As both the brand will retain their identity, market dynamics may not change largely. Mobilink will remain the significant market player. However, Telenor will inject fuel for sure – especially in marketing, customer support and HR departments of Warid.
By the way, Telenor’s buyout of Warid does not mean at all that Telenor Pakistan itself is not for sale, that we heard about few months ago.
Warid gives stance on media rumor: The statement, issued by Warid, endorses the un-authenticity of the news circulated in the media and it explains clearly that no such information is issued by the company Management.
Statement further said that Warid Telecom is a responsible organization that always keeps the public update on any developments.