Etihad Atheeb Telecommunications, which won a license from the Communications and Information Technology Commission (CITC) to operate a new fixed line in Saudi Arabia, on Saturday announced the launch of a SR300 million initial public offering (IPO). Prince Abdul Aziz Bin Ahmad Bin Abdul Aziz, Chairman of the Constituent Committee of Board of Directors, Etihad Atheeb Telecommunications, made the announcement at a press conference here. “With the launch of the IPO we end decades of monopoly on fixed-line telecommunication services in Saudi Arabia,” he said adding that a new future for the telecommunications sector will begin in the country.” Dr. Ahmed Abbas Sindi, CEO, Etihad Atheeb Telecommunications, and a large number of businessmen and officials of the company were also present. Last year, 10 consortia led by international companies, including India's MTNL, applied for Saudi Arabia's second landline phone license. The licensing of Atheeb Telecommunications Consortium that includes Atheeb Group, Nahla Company, Batelco (Bahrain), and Traco to set up and operate a landline phone network in the Kingdom will end the decades' old monopoly of Saudi Telecom Company in landline telephone operation. Etihad Atheeb Telecom will sell 30 percent of its shares for a total value of SR300 million. The designation and over-subscription refunds of each share priced at SR10 will end on Feb. 7, 2009. Prince Abdul Aziz said Etihad Atheeb will introduce state-of-the-art technology to meet the needs of future development, knowledge-based industry and business expectations. “We proceed from our high confidence in the strength of the Saudi economy and the guidance of King Abdullah, Custodian of the Two Holy Mosques, and his wise government to convert the Kingdom's conventional economy to a knowledge-based economy,” he said. Saudi Arabia is one of the countries least affected by the global financial crisis that has swept many countries and sectors, he said adding that the effect on the ICT sector was particularly small. Dr. Sindi said Capital Market Authority (CMA) has approved the launch of the first IPO in 2009 “and the first for several months despite the difficult world economic situation which shows strong confidence in our company.” He said the company has signed agreements for a number of infrastructure projects worth SR1.2 billion. The fixed-line telephone penetration rate is not more than four percent of the total population in the country while the rate of broadband Internet penetration does not exceed 14 percent, he said without giving any fixed timeline for the start of operations. However, he said there is huge potential for growth in these two areas of the ICT sector. “The strength of Ethihad Atheeb Telecom lies in its huge expertise in the areas of ICT and the Internet,” he said. Etihad Atheeb Telecom is offering 30 percent of the company's shares for subscription by individuals at a price of SR10 each share. The IPO will be open for 10 days, including February 2, 2009, the closing day. The company's capital is SR1 billion ($266.67 million). The other 70 percent of the shares were designated to the partners, and the total amount (SR700 million or $168.67 million) was fully paid. Individuals can subscribe to a minimum of 50 shares (SR500). The subscription is open to Saudi citizens only. However, divorced or widowed Saudi women with minor children from non-Saudi husbands may subscribe in the children's names on their mothers' behalf. Subscriptions can be made in any of the branches of the receiving banks or through ATM machines, the banking telephone, or the banks' Internet websites. Etihad Atheeb Telecommunications' subscription forms are available with eight receiving banks that include The Saudi Hollandi Bank, Samba Financial Group, Banque Saudi Fransi, the National Commercial Bank, Saudi British Bank (SABB), Al-Rajhi Bank, Riyad Bank, and the Arab Bank. This is in addition to the IPO manager and underwriter (Saudi Hollandi Capital) and underwriter Al-Ahli Capital. The IPO prospectus is also available on the company's website www.atheeb.net and on the Capital Market Authority's website www.cma.org.sa.
