Having set the company an ambitious target of doubling revenues from the Middle East and Africa (MEA) region by 2015, France Telecom (FT) Orange's CEO, Stephane Richard, is thought to be in talks to acquire a stake in Korek Telecom, an Iraqi mobile operator.
According to well-connected sources, FT Orange is interested in acquiring a minority stake in Korek Telecom, which would value the Iraqi operator at US$1.5 billion, with an option of gaining full control in the future.
Indications that Richard is prepared to push ahead with this expansion into the MEA countries came shortly after his appointment in September as CEO, with a surprise move to grab a 40 per cent shareholding in Morocco's Meditel for €640 million.
However, Korek Telecom is very much the junior operator in Iraq with around three million mobile customers, compared with Zain's 11.8 million and AsiaCell's 7.9 million. While the company has a licence to provide national coverage, it presently only provides services to the Northern regions of Iraq.
This strategy to acquire a minority holding in second or third tier players in emerging markets has been attempted by Vodafone and DoCoMo over some years. However, both of these operators have largely failed to build these weaker operators into gaining a meaningful share of the market, and are now looking to divest themselves of some of these non-core investments.
Korek Telecom was founded in 2000 by Sirwan Mustafa, who is its sole shareholder and nephew of Massoud Barzani, president of Iraq's autonomous Kurdistan region.
- see this Rethink Wireless article
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