Indonesia’s communications minister confirmed yesterday that Qatar Telecom may gain majority control of the country’s second largest operator Indosat, by increasing its stake from 40.8 per cent to a maximum of 65 per cent.

Qtel will have greater exposure to the Indonesian market following the announcement it can gain a majority stake in operator Indosat.

However, Qtel has two years in which to separate Indosat’s fixed-line and mobile companies, as telecommunications law allows a maximum of 65 per cent foreign ownership for mobile operators and 49 per cent for fixed-line.

Qtel acquired a 40.8 per cent stake in Indosat from Singapore Technology Telemedia in June, at a cost of US$1.35 billion

“It is our sincere belief that Indosat will be a stronger company with one shareholder holding more than 50 per cent of the shares,” stated Qtel’s chairman Sheikh Abdullah Bin Mohammed Bin Saud Al Thani. “This will provide a solid basis for future investment.”

A statement from Qtel advised that upon receiving formal notice of the clarification from the authorities, the telco would soon proceed with coordinated tender offers in Indonesia and the US for a majority stake in Indosat. Subject to confirmation by the Indonesian market regulator and under the new mandatory tender offer procedures, the offer price for each Series B share would be set at IDR6,416 (US$0.64).

Indonesia has already demonstrated its potential for Qtel, with Indosat operations contributing 17 per cent to group revenues in the third quarter of 2008, post-acquisition. Indosat ended the period with 36.3 million customers.

As of Q308, Indonesia become Qtel’s second largest market by revenue, with only Qatar contributing more. Indonesia is the fourth most populous nation in the world with 230 million people, and with mobile phone penetration rates estimated at 48 per cent, the Qatari operator is confident there is significant scope for continued growth and development.

Oman’s regulator yesterday announced that the PCCW-Awaser Oman consortium was the winning bidder for the country’s second fixed-line licence, dealing a heavy blow to mobile operator Nawras, which was widely expected to win the concession.

Nawras CEO, Ross Cormack, was keen to gain access to an international gateway, which comes as part of the fixed-line concession

Oman’s TRA stated that the PCCW-Awaser Oman consortium achieved the highest marks in the technical and commercial evaluation, as well as the financial bid, and that the licence award was a milestone in the liberalisation of Oman’s telecommunications sector.

“Naturally we are disappointed,” commented Ross Cormack, CEO of Nawras, after the regulator’s announcement.  “We were very keen to have the opportunity to play a greater part in the bold vision for the development of communication in the sultanate with the fixed licence.”

PCCW is a leading operator in Hong Kong with more than 2.5 million fixed-line connections and the telco was an unsuccessful bidder for Qatar’s second fixed-line licence, where it participated through a consortium in partnership with the Qatar Investment and Project Holding Company (QIPCO).

According to the Oman TRA’s statement, once all the necessary requirements are met by the winning consortium, the regulator’s endorsement will be forwarded to the Ministry of Transport and Communications, while that the winning bidder has 15 working days to honour its obligation.

Etisalat launched commercial services in Nigeria on October 24, making the telco the fifth licensed GSM operator in Africa’s most populous country and the company’s eighteenth operation worldwide.

Etisalat enters a tight Nigerian mobile market where it will compete with incumbent operators Globacom, MTN Nigeria, Zain Nigeria (formerly Celtel) and Mtel.

Mobile services were launched in six cities – Lagos, Ibadan, Abuja, Kano, Port-Harcourt and Kaduna, with further cities expected to be added shortly.

Etisalat faces a competitive marketplace, competently serviced by four incumbent mobile operators – MTN Nigeria, Zain Nigeria, Globacom and Mtel. As of August, there were 54 million mobile subscribers in Nigeria, representing a mobile penetration rate of around 40 per cent. There are also numerous unified access service licensees that offer an array of fixed and wireless propositions.

However, Hakeem Belo-Osagie, chairman of Emerging Markets Telecommunications Services (EMTS), the company that owns the licence in Nigeria, remains bullish that the Emirati telco will excel in the complex Nigerian market.

“Etisalat’s success in countries like Egypt, Afghanistan, Sudan and Central African Republic shows that it has the capacity to thrive in difficult and challenging terrains. Here in Nigeria, Etisalat will replicate and even surpass its achievements in those markets,” Belo-Osagie stated.

Etisalat has made an aggressive entrance with a pre-launch promotion offering up to one million Nigerians the opportunity to reserve at no cost their choice of mobile number starting with 0809, as well as receive a free prepaid SIM card that includes free airtime every month, indefinitely. It is believed that almost all of the promotional SIMs have been reserved.

In January 2007 the Nigerian Communications Commission (NCC) confirmed the receipt of full payment of US$400 million by the UAE’s Mubadala Development Company for the award of a unified access service licence in the country.

The unified licence consists of permission to operate a mobile network in GSM 900MHz and 1800MHz spectrum bands. The NCC introduced a unified licensing regime in March 2006, for the first time allowing operators of wireless local loop operations to roam across wide licence areas. Four unified licences were awarded in May last year, with about two-dozen companies having applied for the concessions.

The award of the licence to Mubadala was part of a wider bilateral agreement between Nigeria and the UAE. Mubadala Development Company is a wholly owned investment vehicle of the government of Abu Dhabi. It was established in October 2002. In September 2007, Etisalat entered a strategic partnership with Mubadala Development Company, which saw the telco becoming the operating partner for the Nigerian telecommunications company. Etisalat holds a 40 per cent interest in the company; Mubadala has a 30 per cent share, with the remaining shares held by Nigerian investors.

Zain, which is present in 22 countries, reported consolidated financial results for the third quarter of 2008 that showed growth in revenues and net profit with customer numbers reaching 56.3 million. However, the announcement failed to reverse the general slide in the operator’s stock price.

Al Barrak has in his vision to make Zain a 150 million subscriber, US$6 billion EBITDA company by 2011

For the third quarter of 2008, Zain Group recorded consolidated revenues of US$1.887 billion, an increase of 25 per cent compared to Q307. The company’s consolidated EBITDA increased by 20 per cent for the same period to reach US$763.3 million. Zain’s consolidated net profits reached US$326.6 million, an increase of 7 per cent on Q307 profits.

Year-on-year customer growth across the Middle East and Africa was 54 per cent.

“This quarter has been both the most challenging and most rewarding in Zain’s corporate history since the launch of our profitable expansion strategy in 2003,” acknowledged Zain CEO Saad Al-Barrak. “Despite financial turmoil across the globe, we are delighted to have succeeded in raising US$4.5 billion through our capital increase. Additionally the launch of services in Saudi Arabia has been very successful given we have acquired one million customers in less than two months notwithstanding the fierce competition in that market.”

The market did not appear impressed with Zain’s results, with the company’s stock price having been on a steady decline since March, and which suffered a six per cent fall at the end of trading on October 25.

Etisalat’s chairman believes the UAE telco is on track to reach 100 million subscribers by 2010, up from 74 million as of end-September 2008, and representing a growth rate of 22 per cent over the next two-and-a-quarter years.

Speaking recently, Mohammad Omran commented that the telco is in its strongest position ever and is on course to achieve its goal of being one of the top 10 operators in the world by 2010.

Omran believes entry into the Indian mobile market will help drive Etisalat’s bid for 100 million subscribers by 2010

Earlier in October Etisalat reported its consolidated financial results for the third quarter of 2008, showing significant growth in revenues, profits and subscriber numbers. The company reported AED 2.1 billion (US$572 million) in group net profits for the third quarter – an increase of 19 per cent year-on-year. This performance took net profits for the first nine months of 2008 to AED 7.3 billion.

Etisalat recorded net revenues of AED 6.6 billion for the third quarter of 2008 and AED 19.1 billion in total for the first nine months of the year. This represented an increase of 24 per cent, compared to the third quarter of 2007.

“Our acquisition in India has opened yet another key market, which will help power Etisalat’s growth,” commented Omran, referring to Etisalat’s acquisition of a 45 per cent stake in Swan Telecom in India for US$900 million in September. “We are also delighted to have received our first ratings from Moody’s, Standard & Poor’s and Fitch Ratings – which places us in a very strong position to continue our international expansion.”