Manama: Bahrain Telecommunications Co (Batelco) said on Sunday it would buy 49% of Indian mobile telephone operator S Tel Ltd for $225 million, the latest in a string of recent acquisitions by Gulf operators.
Batelco said it was partnering with Millennium Private Equity to acquire the stake in S Tel as it makes its first foray outside of the Middle East, where it operates in six countries.
Last week, Emirates Telecommunications Corp (Etisalat) said it was heading a consortium investing at least $1 billion to build a new mobile telephone network in Iran, and was in talks on an acquisition in Iraq.
Qatar Telecommunications Co said on Saturday it would begin tender offers for shares of Indonesia’s PT Indosat to boost its stake to 65%, while Saudi Telecom Co said last week it was the sole bidder for Bahrain’s third mobile phone licence.
Middle Eastern operators and their major shareholders are less risk-averse than some of their counterparts in other regions as most of them have relative low levels of debt, said Jithesh Gopi, a telecom analyst at Bahrain-based investment bank SICO.
Asset valuations across the world have fallen dramatically in the last six months due to a global economic crisis that has pushed much of the industrialised world into recession.
“Cash is king in this kind of environment, to make use of these opportunities,” Gopi said. Batelco, a former monopoly operator in the island kingdom, said it expected to complete its acquisition of S Tel during the first quarter. S Tel operates in Northern India, where it has licences to offer mobile phone services in six Indian states.
Batelco, which has faced increasing competition in its home market, said last year it is looking to expand in Africa and India to increase the share of income coming from its overseas operations to 80% in the coming years.
India, home to about 1.1 billion people, is the second-largest wireless market in the world, after China.
“Our priority now is to assist S Tel to rapidly roll out network infrastructure and offer mobile services to customers,” Batelco Chief Executive Peter Kaliaropoulos said the statement.
International telecom companies, such as Vodafone and SingTel have entered India’s telecom market through partnerships with Indian firms.