Wataniya Palestine to IPO 15 per cent stake before year-end

Wataniya Palestine Mobile Telecommunications (Wataniya Mobile), the second licensed mobile telecom company in Palestine, today announced its intention to undertake an initial public offering (IPO) of 15 per cent of its shares followed by a listing on the Palestine Exchange.

Offer period is from November 7 until December 2, 2010

• 38.7 million new shares to be sold – no selldown by existing shareholders at the time of IPO
• Fixed offer price of US$1.30 per share
• IPO to raise US$50.3 million
• Indicative market capitalisation of US$335.4 million
• Retail investors in Palestine to subscribe at branches of HSBC, Arab Bank, Bank of Palestine, Palestine Commercial Bank, Palestine Islamic Bank, Qatar National Bank and Quds Bank
• All proceeds to be used for general business and operational purposes, and to assist the funding of the balance of fees payable under the company’s operating licence

Launched in November 2009, Wataniya Mobile is the second mobile telecom company to have been licensed in Palestine, and currently covers 95 per cent of the Palestinian population in the West Bank.

Total subscriber figures reached 110,835 as at end-December, within six weeks of launching operations, and have subsequently reached 302,404 subscribers as at end-September 2010. This represents a mobile market share in the West Bank of approximately 19 per cent.

Wataniya Mobile is licensed to operate in Gaza; however, due to the existing political situation the company has not currently commenced operations there. The cellco has started planning and preparations for building a network in Gaza, and the intention is to launch in Gaza as soon as practicable.

Existing shareholders in Wataniya Mobile are Qtel Group and the Palestine Investment Fund (PIF). Qtel holds its interest in Wataniya Mobile through a chain of subsidiary companies, which includes National Mobile Telecommunications Company (NMTC). NMTC is a leading international telecommunications company in its own right and is listed on the Kuwait Stock Exchange.

PIF is a US$850 million investment fund and the largest investor in the Palestinian economy.

The initial plan at the launch of the operation was for 30 per cent of Wataniya Mobile to be IPOed with NMTC holding a 40 per cent stake and 30 per cent would be held by the PIF.

In the nine month period to end-September 2010, the mobile operator generated revenues of US$24.7 million, while revenues for the third quarter of 2010 amounted to US$11.55 million compared to US$9.12 million for the second quarter of the year.