Etisalat reported to have reached deal over PTCL stake payment

The Pakistan government and Etisalat are reported to have settled a long running dispute over the price paid for a stake in Pakistan Telecommunication Company Limited (PTCL) in 2006.

Etisalat offered US$2.6 billion for a 26 per cent stake in PTCL back in 2006 in staggered payments, but has withheld US$800 million in a dispute over the transfer of assets from the government to the telco.

According to the terms of the agreement, Etisalat was due to pay US$1.4 billion within one month after the signing of the deal in early 2006 and the remaining amount of US$1.2 billion was due to be paid in equal instalments over 4 and a half years, with one instalment every six months.

The settlement reportedly agrees to a payment of US$700 million by Etisalat, which is a reduction of US$100 million based on the valuation of the assets not handed over.

Long standing plans by Etisalat to increase its holding to a controlling 51 per cent stake have been on hold until the dispute is settled.