There are strong signs that Umniah, one of Jordan’s big three mobile operators, could be put up for sale.
Batelco, the Bahraini telco that bought a majority stake in Umniah for just over $400 million in 2006, has mandated Citigroup to potentially offload the company for around $500 million to $600 million, a source close to the matter told Bloomberg.
But a senior Gulf-based banker told Reuters they doubted anyone would be clamoring to get their hands on Umniah, which has a 30 percent market share, and whose nine-month profits fell 25 percent from a year earlier, despite boosting mobile subscribers by 8 percent to 2.9 million over the same period.
“It’s early stages but I would be surprised if it gets huge interest,” the banker said. “It’s a difficult asset in a difficult market, and most of the regional telcos who would be the natural buyers won’t be interested.”
In a bourse filing in response to media reports of a potential sale, Batelco said no decision had been taken by its board to sell any investment. Citigroup declined to comment.
According to Reuters, Batelco has a market capitalization of $1.5 billion and made a profit of almost BD47 million in the nine months to September 30. Of this, Umniah accounted for just under $5 million.