Sunday, Jul 24, 2011

(This item was originally published on Thursday)

By Shereen El Gazzar

Of ZAWYA DOW JONES

CAIRO (Zawya Dow Jones)--Zain Sudan, a unit of Kuwait-based telecoms firm Zain Group (ZAIN.KW), expects revenues grew 14% in the second quarter as it added more subscribers and plans to spend more than $100 million on infrastructure in the south of the country following the region's recent declaration of independence, a top executive said.

Zain Sudan is targeting 12 million subscribers by the end of the year, the company's managing director Elfatih Erwa told Zawya Dow Jones in a recent telephone interview. According to the telco's website it had 10.65 million subscribers at the end of the first quarter.

South Sudan declared independence earlier this month after nearly 50 years of war with Sudan and millions of deaths. The United Nations voted to admit South Sudan as its 193rd member and the country was subsequently issued a new country code by the International Telecommunications Union, or ITU.

Zain Sudan plans to separate and expand its mobile telecoms network in South Sudan as well as provide new SIM cards for users as the old cards will become obsolete as a new country code has been assigned, said Erwa.

"Until this moment it's business is as usual. Nobody has asked us to stop," said Erwa. "Operators will have a six months grace period to implement the code [new country code] from the United Nations recognition of South Sudan," he added.

Sudan has become an increasingly important, and profitable, country for Zain and was the third biggest revenue contributor to the overall group in the first quarter behind Iraq and Kuwait.

Zain Sudan's Erwa expects the number of mobile subscribers in South Sudan to hit 700,000 by the end of the year, from about 500,000 at present. Mobile penetration in Sudan currently stands at about 45%, a far cry from levels near, and above, 100% in other north African countries.

As it stands, the south of Sudan contributes only 6% of revenue coming from the country, while consuming 20% of the unit's spending, said Erwa.

"We are going to increase revenue from south of Sudan by increasing our customer base and the usage of our network," he added.

By Shereen El Gazzar, Dow Jones Newswires, +9714 446 1684 Shereen.elgazzar@dowjones.com

Copyright (c) 2011 Dow Jones & Company, Inc.

(END) Dow Jones Newswires

24-07-11 0353GMT