The UAE’s biggest telecoms operator e& acquired a 9.8 per cent stake in British mobile carrier Vodafone Group for $4.4 billion as it seeks to diversify operations globally.
Emirates Telecommunication Group, formerly known as Etisalat, has acquired approximately 2,766 million shares in Vodafone, it said in a statement on Saturday to the Abu Dhabi Securities Exchange (ADX), where its shares are traded.
“Vodafone is one of the leading businesses at the heart of digital communications in Europe and Africa with a compelling business offering critical connectivity and digital services,” Hatem Dowidar, group chief executive of e&, said.
“Our investment represents a unique opportunity to acquire a significant stake in one of the leading and strongest global telecom brands, and a company that we know well. We are looking forward to building a mutually beneficial strategic partnership with Vodafone with the goal of driving value creation for both our businesses, exploring opportunities in the rapidly developing global telecom market and supporting the adoption of next-generation technologies.”
The company, based in Abu Dhabi, was founded in 1976 and is the UAE's oldest telecoms business. It has operations in nearly 16 countries across the Middle East, Asia and Africa, serving more than 156 million customers.
In February this year, e& rebranded as it sought to transform into a global technology investment conglomerate.
The UAE telecom operator does not seek board representation on Vodafone and does not intend to make an offer for the company, the statement said.
Vodafone is one of the leading businesses at the heart of digital communications in Europe and Africa with a compelling business offering critical connectivity and digital services
Hatem Dowidar,
group chief executive of e&
“e& sees this investment as a highly efficient use of its strong balance sheet at a compelling and attractive valuation with strong currency diversification benefits. It provides a clear opportunity to realise future value through potential capital gains and dividends. It may also lead to possible commercial partnerships in the areas of R&D, technological applications and procurement,” according to the statement.
Vodafone’s reputation for being a digital-first operator, underpinned with its rigorous approach to corporate governance and well-regulated global footprint, makes it an attractive opportunity for e& at this current time, the statement said.
e& reported a 3.6 per cent rise in first-quarter net profit supported by growth in the number of subscribers.
Net profit attributable to the owners of the company for the three-month period ended March 31 rose to Dh2.4bn ($653.3 million), compared with Dh2.3bn during the same period last year.
Revenue of the operator remained flat at more than Dh13.3bn during the period. Earnings a share rose to 0.28 cents.
In October, it signed a binding agreement with Abu Dhabi-based artificial intelligence services provider G42 to merge its data centre services and create the UAE’s largest data centre provider.
In August last year, Etisalat acquired an additional stake in Maroc Telecom Group, increasing its effective ownership from 48.4 per cent to 53 per cent.
Top investing tips for UAE residents in 2021
Build an emergency fund: Make sure you have enough cash to cover six months of expenses as a buffer against unexpected problems before you begin investing, advises Steve Cronin, the founder of DeadSimpleSaving.com.
Think long-term: When you invest, you need to have a long-term mindset, so don’t worry about momentary ups and downs in the stock market.
Invest worldwide: Diversify your investments globally, ideally by way of a global stock index fund.
Is your money tied up: Avoid anything where you cannot get your money back in full within a month at any time without any penalty.
Skip past the promises: “If an investment product is offering more than 10 per cent return per year, it is either extremely risky or a scam,” Mr Cronin says.
Choose plans with low fees: Make sure that any funds you buy do not charge more than 1 per cent in fees, Mr Cronin says. “If you invest by yourself, you can easily stay below this figure.” Managed funds and commissionable investments often come with higher fees.
Be sceptical about recommendations: If someone suggests an investment to you, ask if they stand to gain, advises Mr Cronin. “If they are receiving commission, they are unlikely to recommend an investment that’s best for you.”
Get financially independent: Mr Cronin advises UAE residents to pursue financial independence. Start with a Google search and improve your knowledge via expat investing websites or Facebook groups such as SimplyFI.
Tax authority targets shisha levy evasion
The Federal Tax Authority will track shisha imports with electronic markers to protect customers and ensure levies have been paid.
Khalid Ali Al Bustani, director of the tax authority, on Sunday said the move is to "prevent tax evasion and support the authority’s tax collection efforts".
The scheme’s first phase, which came into effect on 1st January, 2019, covers all types of imported and domestically produced and distributed cigarettes. As of May 1, importing any type of cigarettes without the digital marks will be prohibited.
He said the latest phase will see imported and locally produced shisha tobacco tracked by the final quarter of this year.
"The FTA also maintains ongoing communication with concerned companies, to help them adapt their systems to meet our requirements and coordinate between all parties involved," he said.
As with cigarettes, shisha was hit with a 100 per cent tax in October 2017, though manufacturers and cafes absorbed some of the costs to prevent prices doubling.
What can victims do?
Always use only regulated platforms
Stop all transactions and communication on suspicion
Save all evidence (screenshots, chat logs, transaction IDs)
Report to local authorities
Warn others to prevent further harm
Courtesy: Crystal Intelligence
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