BRIEF: Saudi's Mobily Agrees To Settle Disputes In Connection With Govt. Royalties

ETIHAD ETISALAT CO 7020.SE :

* REACHES AGREEMENT WITH MOF, MCIT AND CITC TO SETTLE ALL OLD DISPUTES IN CONNECTION WITH GOVERNMENT ROYALTIES UP TO END OF 2017

* AGREEMENT TO DEFINE A NEW MECHANISM FOR THE CALCULATION OF SERVICE ROYALTIES AND LICENSE ROYALTIES, STARTING FROM 2018 ONWARDS

* NEW INVESTMENT FRAMEWORK FOR DEVELOPMENT OF TELECOMMUNICATION INFRASTRUCTURE TOWARDS BETTER QUALITY FOR EXISTING TECHNOLOGIES

* NEW ROYALTY MECHANISM WILL CONSIST OF ANNUAL SERVICE ROYALTY EQUAL TO 10 PERCENT OF ANNUAL NET TELECOMMUNICATION REVENUES

* NEW ROYALTY MECHANISM WILL ALSO CONSIST AN ANNUAL LICENSE ROYALTY EQUAL TO 1 PERCENT OF THE ANNUAL NET TELECOMMUNICATION REVENUES

* NEW ROYALTY MECHANISM IS NOT EXPECTED TO HAVE MATERIAL IMPACT ON 2018 FINANCIALS AS ITS IMPACT WILL BE COMPENSATED BY REVERSAL OF EXISTING PROVISIONS

* STARTING FROM 2019, IMPACT REPRESENTS AN ADDITIONAL COST ESTIMATED TO BE IN RANGE OF 450-600 MILLION RIYALS PER YEAR OVER NEXT FEW YEARS

Source text for Eikon: ID:nSSE51dLQK Further company coverage: 7020.SE

((Reuters.Briefs@thomsonreuters.com;))