RIYADH, Saudi Arabia, October 4, 2016 /PRNewswire/ --
- Most important development for the Company since inception says Chairman
- The company to coordinate with the Ministry of Finance to discuss the alternatives regarding the amounts due to the government
- Customers will benefit from new innovative services
Mobile Telecommunication Company Saudi Arabia (Zain Saudi Arabia) confirms that the High Order announced today grants the Company a 15-year extension to its License, a unified telecommunication license that allows the Company to provide all telecommunication services, and enables the Company to coordinate with the Ministry of Finance to discuss the alternatives regarding the amounts due to the government.
Commenting on the announcement, HH Prince Naif bin Sultan bin Mohammed bin Saud Al Kabeer, Chairman of the Board of Directors of Zain Saudi Arabia offered his gratitude to the Custodian of the Two Holy Mosques King Salman bin Abdulaziz Al Saud, HRH Prince Mohammed bin Naif bin Abdulaziz, Crown Prince Minister of Interior, and HRH Prince Mohammed bin Salman bin Abdulaziz Deputy Crown Prince Minister of Defence.
"This is clearly the most significant development for the Company since inception," said Prince Naif, he continued, "This decision aligns with the Kingdom's "Vision 2030", to diversify the economy and to significantly increase the contribution from private sector companies. Telecommunications is core to every economy around the globe, in fact it is often referred to as a 'lifeblood' industry which enables the digital connectivity requirements of a modern knowledge based economy. As the third mobile operator we have a crucial role to play in the economic transformation of the Kingdom, our role is to benefit all citizens of the Kingdom through bringing innovation and change to our industry. Only through effective competition will this occur. To play our role effectively, the Kingdom needs us to be strong. Therefore on behalf of Zain Saudi Arabia and its shareholders, I sincerely thank our government for their vision and leadership in reaching this decision."
Hassan Kabbani, Chief Executive Officer, of Zain Saudi Arabia said, "I would like to join our Chairman in thanking the government for their support. This is a landmark decision that will accelerate the transformation of the Company."
Mr. Kabbani continued, "There are three elements to the decision, all of which are very beneficial to the Company.
- Firstly, the extension of the Company's License by 15 years will save SAR 433 million per year because the amortisation charge associated with our License will be lower as we amortise the remaining balance of the SAR 23 billion originally paid for the License over a longer period. The Company's License has been extended from an original 25 years to 40 years, ending at 21/03/1469H correspondent to 18/01/2047G. During the 15 year extension period the Company will pay an annual fee equivalent to 5% of net profits at that time.
- Secondly, the Company was granted a unified License, which means that the Company can offer the full range of telecommunications services, including fixed voice and data services. Over time we plan to introduce a range of new innovative services to the market. Naturally we remain open to partnerships to expedite this process.
- Thirdly, the Company will enter discussions with the Ministry of Finance to discuss alternatives regarding the dues to the government."
"This is very positive news for the Company and for the telecommunications industry in Saudi Arabia. This decision brings our goal of reaching sustainable net profits significantly closer."
Mr. Kabbani concluded, "I would also like to thank all those who contributed to this decision, the Ministry of Finance, the Ministry of Communications and Information Technology, CITC, Zain KSA Chairman and board members, as well as the combined efforts of all of the Zain team."
SOURCE Zain KSA