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RPT-Kuwait wealth fund to sell Wataniya stake to Qtel -sources

Saturday, 6 Oct 2012 | 11:37 PM ET

(Repeats story issued on Saturday with no change to text)

* Qtel to own more than 90 pct of Wataniya after tender -source

* KIA tenders entire 23.5 pct stake -source * Qtel had bid $2.2 bln for remaining 47.5 pct stake * Announcement of tender details expected Sunday By Dinesh Nair and Matt Smith

DUBAI, Oct 6 (Reuters) - Qatar Telecom (Qtel) is set to control more than 90 percent of Kuwait's Wataniya

after the Gulf state's sovereign wealth fund tendered its entire stake in the unit, two sources familiar with the situation said on Saturday.

Qtel, which operates in 16 countries across the Middle East, Africa and Asia, offered $2.2 billion in August for the 47.5 percent of Wataniya it does not already own.

The tender offer expired on October 4.

Kuwait Investment Authority (KIA), one of the world's largest sovereign wealth funds with about $300 billion in assets, is currently the second biggest shareholder in Wataniya, with a stake of 23.5 percent.

"The KIA has decided to tender its full stake. Qtel will own more than 90 percent of Wataniya after the offer and the shares will continue to be listed on the Kuwait bourse," a source said, speaking on condition of anonymity as the matter is not public.

KIA and Qtel were not immediately available for comment outside business hours on Saturday.

A statement to the Kuwait bourse was expected on Sunday giving details on the percentage of shares tendered, the first source said.

Qtel bought its controlling Wataniya stake in 2007 but is seeking full control to capitalise on the telco's weak share price and attractive growth prospects in emerging markets such as Algeria and Tunisia.

KIA also holds 23.5 percent stakes in Kuwait's largest telecoms operator Zain and unlisted Viva.

In 2010, when United Arab Emirates telecom company Etisalat

bid around $12 billion to take control of Zain, the fund was not willing to sell its holding, a banking source told Reuters in August. Etisalat eventually pulled its bid.

"KIA is a financial investor before anything else. It looked at the merits of the offer based on price and decided to take a call which it thought appropriate," the first source said.

"That does not mean they are a seller for their other telco stakes. Everything comes with a price and sophisticated investors know that well."

A Wataniya deal would complete a busy few months for Qtel, which completed a $1.9 billion rights issue in May and agreed in June to double its stake in Iraq's No. 2 telecoms operator, Asiacell, to 60 percent for $1.47 billion.

The settlement for the tender is expected to be completed by the end of October, the source said.

(Additional reporting by Sylvia Westall in Kuwait; Editing by Catherine Evans)

((dinesh.nair@thomsonreuters.com)(+ 971 4 366 4265)(Reuters Messaging: dinesh.nair.reuters.com@reuters.net))

Keywords: QATAR WATANIYA/STAKE