DUBAI, June 20: Emirates Telecommunications Corp. (Etisalat), which won control of Pakistan Telecommunications Co. Ltd. (PTCL) on Monday, expects the $2.59 billion investment to pay off within five years, the head of its international operations said.

The UAE company saw off rival bids with its offer for a 26 per cent stake and management control of the PTCL.

The runner-up was China Mobile (Hong Kong) Ltd., which offered $1.409 billion. Analysts had been expecting the stake to fetch $1.75 billion to $2 billion.

Obaid Saeed Bin Mes’har, chief executive of Etisalat International, said the investment would pay off within five years, hopefully sooner. His bid was about 40 per cent above the average PTCL share price for the past six months.

“We feel this is the right value,” he told reporters in Dubai, adding that the premium was fairly standard given that Etisalat was guaranteed management control.

The deal would be 25 per cent financed through equity and 75 per cent through bank lending. Dubai Islamic Bank will provide 10 per cent of the equity and 10 per cent of the debt component.

Mes’har has pushed Etisalat beyond its home market of the United Arab Emirates into neighbouring Saudi and six West African states.

If Etisalat makes a success of PTCL it will reap the benefits of being the leading player in a large, underdeveloped market, said one UAE analyst.

“If you can sustain yourself until that break-even point then, yes, it is something that you can do. And the UAE has sufficient resources to sustain that development,” said the analyst, who asked not to be named.—Reuters