Thursday, Apr 16, 2009

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BEIRUT (Zawya Dow Jones)--Emirates Telecommunication Co.Emirates Telecommunication Co., or EtisalatEtisalat, is targeting opportunities in Syria and Lebanon to expand its business but will grow more conservatively in 2009 due to the global economic crisis, the operator's chairman said.

EtisalatEtisalat, the U.A.E.'s number one operator, will make a bid for Syria's third mobile phone license this year and will also look to buy licenses in Lebanon when the country privatizes its telecom sector, Mohammad Hassan Omran, EtisalatEtisalat's chairman, told Zawya Dow Jones Thursday in an interview on the sidelines of a telecoms conference in Beirut.

"We are looking to participate in Syria's third license," Omran said, adding that EtisalatEtisalat has also shown its "intention to the Lebanese government that when they privatize ... the mobile sector and open up their fixed line (license), we're interested."

Lebanon has long said it would open up bids for the country's two existing mobile networks, LibanCell and Alpha, and allow a third operator to set up. However, the country's government hasn't made much progress on its privatization plans and analysts are doubtful the licenses will be sold in the near future.

Omran said EtisalatEtisalat, flush with cash from years of strong growth, will continue to expand this year but more conservatively due to the global financial crisis. Target areas are the Mideast, Africa and Asia, he added.

The company will use its own funds for possible expansions, Omran said. "We use much less money from banks and this is a major strength," he said.

Omran said the telco will be cautious when expanding due to concerns over currency fluctuations affecting EtisalatEtisalat's profits.

So far, the only country that has eaten into EtisalatEtisalat's profits due to currency fluctuations is Pakistan, he said. The telco is countering the impact of Pakistan's volatile currency by expanding its fixed network in the country, Omran added.

EtisalatEtisalat, which acquired a 45% stake in Indian operator Swan Telecom in 2008, hopes its Indian operations will be "launched by the second half and we hope to have 20 million subscribers after 12 months of operations," Omran said.

In its home market in the U.A.E., EtisalatEtisalat will strengthen its position by introducing fiber-optic cables to improve connectivity, Omran said.

"By July our target is to have Abu Dhabi connected through fiber-optic cable," he said. "By the end of 2011, we will target 90% of homes and offices in the U.A.E."

EFG Hermes expects the operator to post a first-quarter net profit of AED2.1 billion, down 0.9% on the corresponding period a year earlier. EtisalatEtisalat's fourth-quarter 2008 net profit slipped 20% year-on-year to AED1.4 billion, missing analysts' forecasts.

-By Maria Abi-Habib, Dow Jones Newswires; +9714 364 4962; maria.habib@dowjones.com

Copyright (c) 2009 Dow Jones & Co.

(END) Dow Jones Newswires

16-04-09 0945GMT