Acquisitive e& adds Telenor Pakistan to shopping cart

We’re already halfway through December and the end of 2023 is beckoning, but there might just be time for the highly acquisitive e& (formerly known as Etisalat) to squeeze in one more acquisition before the year is out.

Indeed, like its regional peer STC, UAE-based e& has been on a major shopping spree over the past 12 months, with a focus on telecoms and digital technology. Its overarching aim is to scale up its consumer digital offering, accelerate international growth, diversify into new geographies and transform itself into a "global technology group."

On Thursday, for instance, the group announced plans to expand its existing operations in Pakistan with the acquisition of Telenor Pakistan from Nordic operator Telenor for 5.3 billion Norwegian kroner (US$502 million). The transaction is being made via e& unit Pakistan Telecommunications Company Ltd (PTCL), although the completion of the deal is subject to regulatory approval.

This latest agreement comes hot on the heels of other acquisitions in 2023 that range from entire telecoms operators and digital service providers through to a significant stake in a Tier 1 telecoms player.

On a roll

To be sure, e& wasted no time in getting down to business in 2023. Just 17 days into the year, it announced that it had increased its stake in Vodafone Group to 12%, up from 11% in December 2022. The UAE group originally acquired a 9.8% stake in the UK-based operator in May 2022.

And it didn’t stop there, raising its stake to 13% and then 14% in February. As of April, e&’s stake stood at 14.6%, and reports suggest it wants to increase it further to 20%. In May, e& and Vodafone also agreed to a "strategic relationship" that is designed to "bring the two operators closer together in certain aspects of their businesses."

Amid its focus on the UK's telecoms sector, e& was still plotting further acquisitions elsewhere. In February, for instance, it acquired ServiceMarket, an online marketplace for household services in the UAE.

In May, it completed the formation of a joint venture called Bespin Global MEA that is 65% owned by e& enterprise and 35% by Bespin Global. The JV offers managed and professional public cloud services in the Middle East, Turkey, Africa and Pakistan. In addition, e& invested $60 million in Bespin Global in exchange for a stake of about 10%.

Then in July, it snapped up 63.3% of Beehive, a regulated online marketplace for peer-to-peer lending to SMEs in the MENA region, for $23.6 million.

In terms of further telecoms purchases this year, e& also set its sights on an expansion into Central and Eastern Europe. In August, it signed a binding agreement with the Czech PPF Group to acquire a 50% stake plus one share in PPF Telecom’s assets in Bulgaria, Hungary, Serbia and Slovakia for an upfront fee of €2.15 billion.

PPF Telecom comprises Yettel Bulgaria, Yettel Hungary, Yettel Serbia and the O2 Slovakia service operations, as well as the CETIN and O2 Networks infrastructure. In December, Hungary’s competition authority Gazdasági Versenyhivatalt (GVH) cleared the planned acquisition of stakes in Yettel Hungary and CETIN Hungary. The overall transaction is expected to close in or before the first quarter of 2024, subject to regulatory approvals.

Meanwhile, December not only brought the acquisition of Telenor Pakistan, but also saw e& pick up 50.03% of Careem Technologies (known as Careem Everything App) in exchange for an investment of $400 million. Careem Everything App is the new entity created by carving out the non-rideshare businesses from Careem, with operations in ten countries across the Middle East, Africa and South Asia.

It remains to be seen what else the e& group has up its sleeve for 2024. Worth noting here is that e& has already indicated it has been assessing a potential stake acquisition in Ethio Telecom. “Should there be any developments on this subject, we will keep the market updated in due course,” the group said.