[asterisk-biz] [pashagroup] Etisalat confirms to take over PTCL in 2 weeks - News by GEW

[syed_zahid_arshad]

Business News 
Etisalat confirms takeover within 2 weeks 
ISLAMABAD (inp): Etisalat on Friday confirmed that all the 
stakeholders have reached agreement for the transfer of the PTCL 
management to the UAE operator within two weeks time. 
Etisalat negotiators have closed the deal and all modalities have 
been hammered out that was hampering the deal since long, said an 
Etisalat official.
The official who has recently been hired by Etisalat is among former 
top brass of PTCL, said that a number of former officials have been 
hired who will take charge of important assignments once the UAE 
operator takes over the Pak telecom.
A crowd of unnecessary officials, drawing millions, has been 
appointed in the PTCL on political basis who will be fired in March 
(after the formal takeover), he said while requesting anonymity.
On Feb 22, the Privatization Commission, in an official statement 
claimed that all issues have been settled down and the deal will be 
finalized within a fortnight. 
The minister for privatization Dr Abdul Hafeez Sheikh, who is to 
join World Bank soon want to close the deal before his departure; 
also he wants to sell steel mills before leaving the job, sources in 
the PC told inp.
Sheikh recently said that the PTCL handing over to Etisalat would 
take one or two weeks. Justifying the time lag he said: "It is a 
very big deal —such deals take time."
Etisalat's $2.6 billion takeover bid for PTCL, slackened by 
uncertainties, is finally seeing the light at the end of the tunnel 
with both sides reaching the final accord on transferring the 
management.
"The conclusion to more than six months of intense negotiations and 
bargains that has raised many questions about the conduct and 
efficiency of the Privatization Commission, and invited undue media 
attention," said Zahid Arshad Shah, Chairman Global Economy Watch 
Pakistan. 
The deal ran into rough waters after Etisalat failed to meet payment 
deadlines after offering to pay $2.6 billion on June 18, 2005. The 
deal came under heavy criticism, as many believed it as heavily 
overpriced, surpassing the rivals — China Mobile and SingTel. 
The first installment of $260 million was paid in the same month and 
the rest of the payments were delayed repeatedly.
"The delays pushed Pakistan to succumb to ever-increasing demands of 
Etisalat for relaxations and some dangerous trends were set that 
could be detrimental for the future of privatization," said Shah.
After some delays, the two sides agreed in Dec to amend the payment 
structure and keep the deal. According to the agreement, Etisalat 
will pay $1.14 billion up front, and the rest will be spread over a 
five-year period.
"Etisalat's decision to go-ahead with the deal despite mounting 
criticism that its bid was overpriced by $1 billion was prompted by 
the explosive growth in local mobile market. 
Local mobile subscribers surged to nearly 20 million from just two 
million in the past 18 months, adding some 1.25 million subscribers 
every month - which cannot be ignored by the UAE operator," Shah 
opined. 
Telecoms penetration grew to 18 percent from 4.5 percent in two 
years, and it is projected to rise 35-40 percent in another two 
years, another 30 million users are expected to be added in next two 
years.

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