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The move, part of the much-awaited relief package announced by the Federal Cabinet to help the financially-strapped telecom sector, will benefit companies such as Vodafone Idea, Bharti Airtel, and Reliance Jio
Telecom4 months ago
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Etisalat secures approvals to raise foreign ownership limit to 49%
Dubai - Abu Dhabi-based telecom giant says new ownership limit for non-UAE nationals has come into effect
In January, both telecom operators in the UAE — etisalat and du — announced its plans to increase the foreign shareholding limits from 20 per cent to 49 per cent. — Supplied photo
Emirates Telecommunications Group, popularly known as Etisalat group, on Tuesday announced that it secured the necessary approvals to allow foreigners to own 49 percent of the telecom giant’s share capital.
In a disclosure to the Abu Dhabi Securities Exchange, the telecom giant said the plan to increase the foreign ownership limit in their stocks to 49 per cent “has come into effect” following the relevant approvals.
In January, both telecom operators in the UAE — etisalat and du — announced its plans to increase the foreign shareholding limits from 20 per cent to 49 per cent.
Telecom experts said the increase in ownership limits would allow etisalat and du to sign strategic partnerships and inflows with key foreign players that will help help boost their revenues and subscribers base.
Daniel Takieddine, senior market analyst at FXPrimus, said etisalat’s decision to raise foreign ownership in its capital should make the company more attractive to foreign investors and should help grow the company’s profile internationally.
“The move should attract new investors as well as passive inflows as index providers should increase the stock’s weight in their indices, propping up the stock price in the process,” Takieddine told Khaleej Times.
“A provision in Federal Decree by Law No. 1 of 2021 concerning Etisalat Group has already been amended to increase the foreign shareholding limit in the company’s capital to 49 per cent,” according to the Etisalat disclosure to ADX.
The disclosure further said that all the necessary approvals for amending the company’s Articles of Association have also been secured so the group is authorised to increase the foreign ownership limits to 49 per cent with immediate effect.
“Based on the above, increasing the foreign ownership limit in the company’s share capital has come into effect,” the disclosure said.
Etisalat shares on Tuesday surged 6.5 per cent, its biggest intraday rise in over eight months after it secured required approvals to increase foreign ownership limit to 49 per cent.
— muzaffarrizvi@khaleejtimes.com
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