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Iraq's Korek Telecom says 2011 IPO unlikely

Iraq's Korek Telecom says 2011 IPO unlikely


Iraq's Korek Telecom is unlikely to launch an initial public offering this year, its chief executive told Reuters on Thursday.

Under the terms of their licences, Korek and rival carriers Zain Iraq, a unit of Kuwait's Zain, and Asiacell, a unit of Qatar Telecommunications (Qtel), were meant to launch IPOs by the end of August.

But all three operators missed the deadline. Korek is partly owned by France Telecom and Kuwaiti logistics group Agility.

"The IPO is very complicated," Korek Chief Executive Ghada Gebara said in Dubai. "All the companies' status has to change from limited companies to shareholder companies. The three of us have not yet (done this)."

When asked if Korek, Iraq's third-largest mobile phone operator, would do an IPO before year-end, she said: "I would be very surprised."

Gebara said 25 per cent stakes in each of the three operators would be worth about $5 billion combined, while Iraq bourse turnover was about $1.5 million a day, so the market was ill-prepared for these IPOs.

"It will be very difficult to do," said Gebara.

Iraq did not have a mobile phone industry under Saddam Hussein, but the industry has grown rapidly since the 2003 US-led invasion that toppled the dictator, and is one of the few regional markets offering double-digit subscriber growth.

There are around 23 million mobile phone subscribers in the country, according to the Communications and Media Commission (CMC), which regulates telecommunications in Iraq.

Separately on Thursday, Iraq's communications minister said he is sticking with plans to auction a fourth mobile licence by the end of 2011.

Gebara criticised the government's determination to do this.

"What is the message you are sending to international investors coming to Iraq? (France Telecom) signed on a certain basis and all of a sudden you (the government) change the game," she said.
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