Saudi mobile phone operator Etihad Etisalat (Mobily) has agreed to buy 99.9 percent of local data provider Bayanat al-Oula for 1.5 billion riyals ($400 million).

Bayanat is one of two firms licensed to deploy a WiMax wireless Internet access network in the kingdom, a Mobily spokesman said.

"We want to develop our data services," he told Reuters.

Mobily, in which Emirates Telecommunications is the main shareholder, has made the development of broadband and data services a priority to maintain profit growth as competition is set to heat up further with the arrival next year of a third mobile phone operator led by Kuwait's Zain.

Bayanat al-Oula for Network Services signed a $100 million contract with Samsung Electronics to deploy the largest Mobile WiMax network in the Middle East, according to a statement issued in January and posted on Bayanat's Web site.

"Bayanat will start operations in the fourth quarter of this year," a Bayanat official said, adding that commercial services will be launched first in Riyadh, Jeddah, Dammam, and Makkah.

WiMax -- seen as the big brother to the WiFi standard, which only work near to a transmitter -- allows anyone with a WiMax enabled laptop or media device to download songs, movies and business presentations over distances of up to 50 km (30 miles). - Reuters