There will be more mergers and acquisitions (M&A) in Saudi Arabia's telecom sector over the next two years, according to a survey conducted by the law firm Blakes. The survey was presented by Dr. Saud Al-Ammari, managing partner of the law firm in Saudi Arabia and the Gulf Region, during the recent launching of the Blakes offices in Al-Khobar. “There are very high hopes that telecom sector in the Kingdom will see more M&A with 81 percent of the surveyed respondents expressing optimism in the sector,” Al-Ammari said. Overall, he said M&As are expected to increase in all sectors in Saudi Arabia, except the financial services and real estate. The ranking in the Kingdom's M&A, according to the survey, are telecom (81 percent), infrastructure-transportation (74 percent), infrastructure-healthcare (67 percent), infrastructure-natural resources (59 percent), alternative energy (57 percent), other infrastructures (57&), financial services (40 percent), and real estate (14 percent). Because of the expected robust outlook of the telecom sector, local banks are also willing to provide more lending support to telecom companies. The natural resources, healthcare and transportation sectors will also be provided funding by the Saudi banks. The telecommunications sector in the Gulf region have been growing and expanding rapidly, improving its wireless operations and capabilities and catering more to consumers. Saudi Arabia is leading in the expansion of operations and services, according to the survey. “Asian countries have emerged as prime markets for acquisitions as they offer lucrative assets and licensing opportunities to the GCC's leading telecom companies. Since 2007, UAE-based telecom giant Etisalat entered the markets of India, Indonesia, Sri Lanka and Sudan through acquisitions, and in 2010, Etisalat partnered with South Korean Telecom to provide local internet service. Etisalat has ambitious plans to invest $7.2 billion to acquire new licenses and support the growth of its foreign mobile phone networks,” the survey said. Al-Ammari said Saudi Telecom Company (STC) continues to pursue acquisitions in Asia, focusing primarily on acquiring control in companies in which it has already invested, including the largest mobile operator in Malaysia, Maxis Communications, which is currently 25 percent owned by STC. “The economy of Saudi Arabia is well-positioned for growth in the next three to five years, due largely to developments in the private sector, and particularly in the industrial sector. Indeed, a strong pipeline of planned projects, including government-sponsored construction projects and a host of mega-projects in the oil and raw materials industries, including aluminum plants and oil refineries, are likely to drive the country's steady advancement. Saudi recovery could well lead the GCC region in the years ahead,” Al
