Etisalat and major Zain shareholder Kharafi Group signed an agreement on Wednesday to start the due diligence process for a deal to sell 46 percent of Zain to the UAE telecoms operator.
"Our client has informed us that an agreement has been signed... with UAE Etisalat," the National Investment Co., which represents the Kharafi Group, said in a statement posted on the Kuwait Stock Exchange website.
"Due diligence will start in accordance with the rules and regulations of the company (Zain)."
"Sale procedures will be executed in accordance with the rules and regulations of the Kuwait Stock Exchange," the statement added.
In late September, Etisalat said it had made a preliminary offer to leading investors in Zain, Kuwait's largest mobile operator, to purchase a controlling stake in the company in a deal estimated to cost well above $10 billion.
United Arab Emirates telecoms giant Etisalat has submitted a preliminary conditional offer to buy a 46-percent stake of Zain at 1.7 dinars ($5.97) per share.
The Kharafi Group directly owns 12.7 percent of Zain, but its share is believed amount to more than 20 percent if indirect stakes are taken into account.
The Kuwaiti group had earlier said it started collecting the needed shares from other holders to make up the deal.
The 46 percent is a controlling stake in Zain since 10 percent of its equity is in treasury shares which do not have voting power.
The signing on Wednesday apparently comes after overcoming snags between leading Kuwaiti investors in Zain over the deal.
On Wednesday, Kuwaiti daily newspaper al-Qabas said it learned that the due diligence is expected to take about six weeks or less.
Shares of both Zain and Etisalat were unchanged at 0713 GMT on the Kuwait and Abu Dhabi bourses respectively Wednesday.