Shares in Etihad Atheeb suspended as telco reports massive loss

Shares in Saudi Arabia’s second fixed line network operator, Atheeb Telecom were suspended after the company posted losses that put it in breach of the stock market regulations. The company has now lost 95 per cent of its capital, which exceeds the 75 per cent loss limit imposed by the Saudi bourse.

The company – which is part owned by Batelco – lost US$153 million in the year to March 31, 2011, after losses of US$101 million in the year before. Last June the company’s CEO Ahmed Sindi was replaced by Raed Abdul Rauf Kayyal.

The company has blamed actions by the former monopoly operator, STC for the ongoing losses and has filed a lawsuit against the telco.

It also blames the regulator for not allowing international calls and prepaid card sales, as were permitted in its licence. The company expects to hold a hearing against the regulator next week.

Atheeb has proposed cutting its capital to bring it in line with stock market rules then raising additional funding from its shareholders. The move is still to be approved by the stock market.

Etihad Atheeb Telecom is a joint venture of Atheeb Trading Company, Al-Nahla Trading Company, Batelco and Traco Company.