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Wed 14 Jan 2009 10:00 AM

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Etisalat wins third mobile licence in Iran

UAE-based operator targets 1 million subscribers in first year of operations

A consortium led by Etisalat has won Iran’s third mobile license to provide 2G and 3G services. The consortium, which is 49% owned by Etisalat, and includes Taameen Telecom, a company owned by the Iranian Social Security Organization (SSO), paid an upfront fee of EUR 300 million (US $402.1 million) for the licence, and expects to start operations in Iran within nine months.

Final announcement by Iran’s Communications Regulatory Authority (CRA) was made after it obtained official approval of the Iranian government. Etisalat said that it won over other bidders in terms of “technical qualifications” and its offer of a revenue sharing percentage with the government throughout the license duration.

Mohammad Hassan Omran, chairman, Etisalat, said described Iran as “a very attractive investment environment” and added that the company’s decision to enter the country was “endorsed by careful studies for the Iranian market and all the economy indicators.”

In an interview with news agency Reuters, Jamal Al Jarwan, CEO International Investments said that the consortium intends to invest about US$1 billion in Iran’s telecoms infrastructure and that it intends to target 1 million subscribers in its first year of operations.

In a separate statement, Jarwan added that the telecom market in Iran has “a very promising future”, mainly due to its rapidly growing population estimated at 73 million people, and a large population of young people hungry for mobile services.

The country also has low mobile penetration rates, with around 40 million 2G subscribers divided between two national operators and three other regional operators. “We are confident of the growth potential of this important market especially with our two year exclusivity to offer 3G services,” Jarwan said.

Etisalat operates in 17 international markets with a combined population of 1.6 billion people and has more than 74 million subscribers.

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