A Kuwaiti court has delayed a hearing issued by Zain shareholders Al-Fawares Holding Company, due to take place on 8 December. The judge has requested more time to go over the documents and will resume the hearing in mid-December.

Al-Fawares is against the planned takeover of the telecoms operator by Abu Dhabi’s Etisalat, which has offered $12bn for a 46 per cent stake. It took legal action to halt the due diligence process that began last month. Etisalat has set a deadline for 15 January 2011 for a final decision. Any delays to the process could scupper the deal.

“We will not allow the sale to take place. Anybody who wants to buy Zain needs the approval of the entire board,” says financial controller at Al-Fawares Holding, Karu Naker.

He says Zain should not have opened its books before the deal was shown to all shareholders and without the consent of the entire board. Naker claims Al-Fawares is still not privy to the deal.

If the acquisition goes ahead then Zain will have to sell its Saudi Arabian unit, as Etisalat already has its own subsidiary in the country, Mobily. “Selling the unit just to meet regulatory laws could jeopardise the unit, we may not get the right price, so we will take anyone who tries to buy Zain Saudi to court,” says Naker.

So far Qatar Telecom, Bahrain’s Batelco and South Africa’s MTN have expressed an interest in buying Zain Saudi. Investment bank UBS has been chosen to sell the group’s 25 per cent stake, worth about $700m.

The Etisalat sale was spearheaded by the Kharafi Group, which in early December secured the backing of Securities Group, another shareholder which had previously opposed the deal.

Al-Fawares Holding owns a 4.5 per cent stake in Zain.