After more than a year of on-and-off negotiations, India’s Bharti Airtel and South Africa’s MTN Group appear to be close to striking a deal that could lead to a tie. Bharti Airtel shares jumped as much as per cent on Thursday on news that it had called off merger talks with MTN after the two companies. The SOUTH AFRICAN government said that it supported the proposal merger of Bharti-Airtel and the MTN group in principle. The Indian Government agreed.
|Published (Last):||26 October 2018|
|PDF File Size:||20.92 Mb|
|ePub File Size:||5.20 Mb|
|Price:||Free* [*Free Regsitration Required]|
The Thomson Reuters Trust Principles. There are targets that Bharti could pursue, analysts said. It has been eyeing another big deal for some time and held failed talks last year with both Bharti and rival Reliance Communications.
Trading equity stakes would give both firms exposure to new markets ripe for growth, while a full merger would yield cost savings, allow for technology sharing, and provide the financial muscle for more expansion, analysts say. Will be displayed Will not be displayed Will be displayed. Reliance to buy majority stake in renewable energy services firm Kanoda. MTN, which had Get instant notifications from Economic Times Allow Not now. Fill in your details: Although it is one of the few companies whose name has not been linked with Zain, Bharti could expand into several African markets with a stake in Zain or its African operations.
As an entrepreneur, you just move on.
MTN deal off, what next for Bharti?
Shares are a common currency for acquisition and Indian companies would be shut out of overseas buyout opportunities if they are not allowed to issue them. A full merger would need government and regulatory approval. We see real power in the combination and we will work hard to unleash it for all our tmn.
Ironically, the transaction under discussion did not involve any loss of national identity for MTN. That would have meant investors selling other assets to comply with limits.
Bharti Airtel-MTN $ 24 billion deal called off
It is a very well considered move and there is a very strong rationale. Neither Ambani could succeed in doing the deal. The Companies Act will also have to be amended to take into account taxation and accounting implications for a dual-listed anv. The exclusive talks had been extended twice since they started on 25 May, a year after the two phone firms gave up their first merger attempt.
We need to scale mgn Capital wall It was clear from the beginning that regulatory barriers would be the biggest obstacle in consummating the Bharti-MTN deal.
Fortis again pushes back date to complete RHT Health deal; auditor resigns. RCom has snapped up a few small emerging-market assets and is believed to be considering more. South African communications minister Siphiwe Nyanda said before the announcement on Wednesday that MTN should remain a domestic company.
Bharti wished MTN management and its board success. Thereafter, the MTN board met and formally called off the deal. This was the case with the proposed MTN-Bharti merger, which required certain exchange control and other approvals. But the Indian company has not totally given up, if its statement has is anything to go by.
Additional reporting by C. The deal was complicated. But it has expressed an interest in Nigeria, a key MTN market. But the risks of capital outflows may not be huge.
In a press statement, the Indian telecom major said that if the deal goes through, it would be achieved through a scheme of arrangement, which would include the following principal elements:.
It is premature to conclude that Bharti had reached the end of the road for its overseas acquisition plans, said Monish Chatrath, executive director and head of risk advisory services and markets leader at consultancy Mazars.
MTN deal off, what next for Bharti? – Livemint
He will go for something bigger than MTN. However, some analysts voiced doubt as to whether a deal would be sealed after similar talks collapsed last year. We probably have more money flowing out due to over and bhari on the trade account.
The announcement that talks were being called off was made after the close of trading.