UAE telecoms operator Etisalat has valued Zain’s Iraq business at $5.76bn, which is almost half of the proposed $12bn takeover of the Kuwaiti telecoms group.

Etisalat placed a bid to take over 46 per cent of the Zain in September 2010 after talks with Iraq’s Korek failed. “Etisalat has wanted to enter Iraq for a long time and they will try hard to make sure this acquisition goes through,” says a source familiar with the talks.

One hindrance to the deal has been Zain’s Saudi Arabian unit, as Etisalat already operates in the market through the Mobily brand. Zain has rejected three offers it has received for the 25 per cent stake it owns in the operating unit.

The initial deadline for the takeover was 15 January 2011, but it was extended following difficulties in obtaining information necessary for the due diligence. The deadline was extended to the end of February, but a final decision is likely to take some more time.

In an emailed statement on 2 March, chief spokesperson Ahmed bin Ali reiterated Etisalat’s interest in Zain. Etisalat is currently in the process of analysing the information collected with the results due to be discussed with Zain and Etisalat board.