UAE's e& Retreats from Global Expansion to Refocus on Core Telecoms
e&'s Strategic Shift and Recent Developments
By Hadeel Al Sayegh and Federico Maccioni
DUBAI, July 16 (Reuters) - UAE telecoms and investment group e& is unwinding much of its expansion strategy of recent years, deepening a retreat from non-core businesses that accelerated with the near $6 billion sale of its Vodafone stake this month, two people familiar with the matter said.
The company's agreement to sell its entire 16.2% stake in Vodafone to an investment vehicle owned by France's Niel family followed the partial sale of its stake in the super app managed by ride-hailing platform Careem to Uber in May.
Leadership Changes and Portfolio Review
The two transactions mark a shift in strategy under new group CEO Masood M. Sharif Mahmood, who took the helm in April after his predecessor's six-year tenure, the people said, speaking on condition of anonymity because the plans are private.
Under the new direction, e& — rebranded from Etisalat in 2022 — is reviewing its portfolio, including its venture capital vehicle e& capital and peer-to-peer lending platform Beehive, the people said.
Core Holdings and Ongoing Discussions
The group intends to retain controlling stakes in European operator e& PPF Telecom Group and telecom operators it owns in emerging markets, one of them added.
The sources cautioned that plans were still being discussed and no definitive decision had been taken.
e& and its majority shareholder the Emirates Investment Authority (EIA) did not reply to requests for comment.
Previous Strategy of Expansion
Growth Initiatives under Former CEO
Under previous CEO Hatem Dowidar, e& had pursued a strategy of using surplus cash from a dominant position in the domestic telecoms market to fund expansion into technology, venture investing and international assets, aiming to reposition the group as a global technology company, the people said.
Shareholder Response and Market Performance
That strategy has not paid off as shareholders had hoped, one of the people said, and the group ultimately concluded that its core telecoms business, where returns are steadier and easier to manage, should be the priority going forward.
e& is 60% owned by the EIA, the UAE's federal sovereign wealth fund, with the remaining 40% traded on the Abu Dhabi Securities Exchange.
The group's Abu Dhabi-listed shares have lost 8.6% in the last three years, giving the company a market capitalization of around 176.9 billion dirhams ($48.2 billion), LSEG data shows. They have however gained 4.3% in the last five days.
Investment Figures and Lending Growth
e& capital had total deployed and committed investments of around $194 million across 20 portfolio companies by the end of last year, e& said, adding Beehive had lent around $350 million to small and medium enterprises in 2025, up 40% from a year earlier.
Move Back Towards Core Operations
Analyst Perspectives on Recent Transactions
Analysts at HSBC and Citi both flagged the Vodafone and Careem sales as signs of a broader pivot toward core operations and balance-sheet discipline, even as they said the company had yet to spell out a formal strategic review.
Financial Impact and Future Outlook
Both said the Vodafone deal would sharply reduce e&'s leverage by the end of 2026, which may allow the company to pay higher dividends. HSBC sees net debt to earnings before interest, tax, depreciation and amortization falling to around 0.5 times from 1.1 times.
The disposal also reduces earnings volatility stemming from Vodafone's share price performance, Citi said in its note to clients on Friday.
($1 = 3.6725 UAE dirham)
(Reporting by Hadeel Al Sayegh and Federico Maccioni; Editing by Jan Harvey)
