The UAE’s Emirates Telecommunications Corporation (Etisalat) has pulled out of bidding for the third Syrian mobile licence, which is expected to be worth a minimum of $122m.
According to sources close to the deal, the UAE telecoms operator is dissatisfied with the 25 per cent revenue share being demanded by Syria’s Communications Ministry. The four other bidders including Turkcell, Qatar Telecom, Saudi Telecoms Company and France Telecom, are understood to be similarly dissatisfied with the deal on offer.
“We put in a file for qualification back in November, but nothing has happened since then. We were not so excited about the licence even before the current unrest since the conditions are limited and not very attractive,” says a spokesperson for France Telecom. The operator recently acquired a minority stake in Iraq’s Korek Telecom.
Turkcell’s management is also cooling on the deal, particularly in light of the growing civil unrest. “The country is going through a difficult process, we have to watch it carefully and we will have to wait and see, but it is not our priority right now,” says Nahit Narin, Turkcell’s head of investor relations.
Qtel and STC are the only bidders still actively pursuing the licence, leaving the auction increasingly uncertain in light of the political unrest sweeping across the country. The auction date has already been extended from April to May and if changes are made to the government, the licence could be postponed.
According to Jordan-based research firm Arab Advisors, Syria’s mobile market has potential to grow with penetration of about 52 per cent, but the licence has been losing value in the eyes of bidders. The current reserve is $122m, substantially lower than the initial valuation of $600m.
Syria’s Communications Ministry and Etisalat were unable to provide a comment at the time of going to press.