EATC drops capital by over half

Saudi Arabia fixed-line operator Etihad Atheeb Telecommunication Co said yesterday it secured approval from shareholders to reduce its capital from 1 billion Saudi riyals (Dh979 million) to 400 million. The move, already approved by the Capital Market Authority, means the number of the company's shares will drop from 100 million to 40 million, the firm said in a statement on the Saudi bourse website. Trading in Etihad Atheeb's shares was suspended by the regulator in late May after the company, which started operations in January 2010, sustained widening losses. Earlier this year, the telecoms firm said it filed a lawsuit to the Grievances Bureau claiming that Saudi Telecom Co had violated the kingdom's anti-monopoly laws by blocking a number of services to its subscribers, which forced the firm to make losses. Article continues below Competition STC, the largest listed telecom operator in the Middle East, refuted the claim. Atheeb, the first partly private fixed-line phone operator, had faced fierce competition from Saudi Telecom and the local units of Kuwait's Mobile Telecommunications Co, better known as Zain, and the UAE's Etisalat. Atheeb has been prevented by CITC from providing services included in its license due to unfair competition with Saudi Telecom and others, Prince Abdul Aziz Bin Ahmad Al Saud said in January. Unlike STC, Etihad Atheeb, 15 per cent-owned by Bahrain Telecommunications Co, wasn't given permission to provide mobile services in addition to its fixed-line services, he said.