Bharti eyes South African teleco MTN once again | delhi | Hindustan Times
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Bharti eyes South African teleco MTN once again

delhi Updated: May 25, 2009 18:50 IST

Indian telecom giant Bharti on Monday announced that it has opened talks for acquiring 49 per cent stake with South African MTN in an estimated 23 billion dollar deal, exactly a year after it pulled out of negotiations alleging that foreign company had deviated from agreement.

The two companies signed an agreement to hold exclusive talks for a deal that could include 10 billion dollars in cash and 13 billion dollars in shares and see emergence of a combined entity of 20 billion dollars in terms of revenue and 200 billion subscribers globally.

In almost identical statements detailing the contours of the agreement, the two sides said that MTN too would acquire 36 per cent stake in Bharti as part of the deal.

After the announcement, Bharti shares plunged Rs 46.45 or 5.4 per cent to close at Rs 811 on BSE.

"Bharti would acquire a 49 per cent shareholding in MTN and, in turn, MTN and its shareholders would acquire an approximate 36 per cent economic interest in Bharti, of which 25 per cent would be held by MTN with the remainder held directly by MTN shareholders," Bharti said in a statement.

MTN was also courted by Anil Ambani Group company RCom after Bharti pulled out of negotiations on May 26 last year accusing that the South African company's Board changed the structure to make Indian teleco its subsidiary.

Ambani, however, could not transact the deal as his elder brother Mukesh-led RIL slapped legal notices on MTN warning them that it had the Right of Firt Refusal on Reliance Communication.