KUALA LAMPUR/KARACHI: Pakistan has lost a business deal worth $940 million after the foreign acquirer of a telecom business in the country faced delays in getting regulatory approvals from the Pakistan Telecommunication Authority (PTA), which is running without a proper head for about 10 months.
According to a notice filed by Dawood Hercules at the Pakistan Stock Exchange (PSX), Malaysian telecommunication infrastructure services company – Edotco – withdrew the deal of acquiring 13,000 communication towers of Deodar, a subsidiary of telecom giant, Jazz.
Dawood Hercules had proposed to acquire 45% share in the company. However, the notice stated, “We are no longer pursuing the transaction to invest up to Rs17.45 billion.”
According to industry officials, both parties scrapped the deal due to a continued delay in the regulatory approvals. Various conditions were needed to be satisfied before consummating the transaction. “Out of the said conditions, certain material conditions have not been satisfied prior to the longstop date prescribed in the agreement. We have therefore earlier today [Monday] exercised our right to terminate the agreement,” stated the company’s notice.
Due to continued delays in regulatory approvals, the deal was not feasible for both sides anymore, said the industry expert. Former PTA chairman Ismail Shah completed his tenure on November 13, 2017. Since then the regulator is without a proper head and is now run by an acting chairman.