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Singapore Telecommunications has emerged as the front-runner to acquire a significant stake in Warid, one of Pakistan’s leading mobile phone operators, according to people familiar with the situation.
The Singapore-based telecoms group is in advanced talks to purchase about 30 per cent of the company, in a deal likely to value Warid at $1bn.
NTM of South Africa and Vodafone of the UK have also expressed interest in acquiring a stake in Warid, although SingTel is now said to be seen as the strong favourite to clinch a deal. One person familiar with the matter said: “A deal between SingTel and Warid could be signed as early as next month.”
Warid said on Monday that it was “assessing” a number of offers, but declined to comment further. SingTel declined to comment.
SingTel has expanded its footprint to 20 countries but has yet to invest in Pakistan, Asia’s fastest-growing mobile phone market after India. It last year failed in an attempt to buy a minority stake in Pakistan Telecom.
SingTel’s investments include stakes in operators in Australia, Thailand and Indonesia, and a 30 per cent holding in Bharti, India’s leading mobile phone group.
According to government data, mobile phone subscription in Pakistan rose by 10m to 58m in the first four months of 2007. At current growth rates, analysts predict that by December half of the 160m population will have a mobile phone.
The soaring growth rates have attracted the attention of leading telecoms groups. Etisalat of the Middle East has acquired a controlling stake in PTCL, while Telenor of Norway bought a licence and is one of Pakistan’s six mobile operators.
Last year China Mobile, the world’s biggest mobile phone company, bought 89 per cent of Paktel for $284m, its first acquisition outside its home market.
Pakistan’s telecoms companies have sought to sell stakes to foreign groups to acquire technology and marketing skills, and to bolster balance sheets hit by the effects of fierce competition.
Warid, which is owned by Abu Dhabi Group, began operations in Pakistan two years ago. It has 10m customers – a market share of 17 per cent.
People familiar with the matter said that Vodafone had been pushing to acquire a majority stake in Warid, although the vendor wants to retain control of management and the brand.
Foreign investors are pouring money into Pakistan in spite of the uncertainty about the military-installed government.
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