JEDDAH, 5 April 2004 — International telecom giants Vodafone of Britain, Deutsche Telekom of Germany and Telefonica of Spain were among 11 consortia prequalified to apply for Saudi Arabia’s second mobile phone operator license.
“Prequalified consortia will be able to purchase the request for application from Communications and Information Technology Commission (CITC) headquarters beginning April 11, 2004,” the commission said in a statement.
The statement indicated that the commission would announce the winner of the license by the last quarter of 2004. The consortia were selected from 12 applicants who took part in the prequalification bid, which ended on March 21.
The license sale is expected to net the Saudi treasury at least $1 billion. Revenue from mobile phone services in Saudi Arabia is expected to rise to nearly $8 billion in 2007.
CITC had stated in the prequalification conditions that candidates bidding for the new mobile license should form a consortium of at least five Saudi companies and an international cellular mobile operator.
The commission has prequalified the following consortia: Etisalat Consortium, FAL Holdings Arabia (Deutsche Telekom), Integrated Visions (Maxis), Kingdom Telefonica (Telefonica Moviles), Mobilkom Saudi Arabia (Mobilkom Austria), MTC & Partners (MTC), MTN Saudi Arabia (MTN), Oger Telecom (Bouygues), Orascom Telecom Saudi Arabia (Orascom), Samawat (Telecom Italia Mobile) and Vodafone & Saudi Partners (Vodafone).
Mohammed Al-Suwayel, the governor of the commission, has said that foreign investors could buy up to 49 percent of the new joint stock company to be set up to operate the new GSM. “The foreign investor can own a minimum stake of 15 percent and a maximum of 49 percent,” he said.
The CITC launched the formal licensing process for the new mobile operator and two new data telecommunications service providers two months ago by issuing a request for prequalification.
Stringent criteria have been set for the operator, who must control and run a mobile network (or networks) serving at least 1.5 million subscribers and must have at least two years’ experience in deploying and operating a greenfield mobile phone system.
Saudi Arabia is the largest telecom market in the Gulf region with four million landlines and seven million mobiles. The sector is growing at the rate of 30 percent annually.
