15 Feb 2010
Indian telco Bharti Airtel has revealed that it has submitted a USD10.7 billion bid for the African operations of Kuwait-based mobile group Zain. According to Reuters, the two companies have agreed a period of exclusive negotiations, lasting until 25 March 2010, which could see Bharti acquire all of Zain’s subsidiaries in Africa excluding Morocco and Sudan. It is understood that Zain’s board has approved the sale of the assets to Bharti, although any potential deal will be subject to due diligence and any required regulatory approvals.
The move represents Bharti’s third attempt at entering the African markets, after two failed rounds of negotiations with South Africa’s MTN Group; most recently in October 2009 it was announced that the two companies had again failed to reach a deal, with the major sticking point in the potential deal understood to relate to South Africa’s desire to retain what it termed MTN’s ‘national character’.
For its part, Zain rejected an offer last year from European major France Telecom for its African assets, and then subsequently said it was halting efforts to sell off the subsidiaries as it looked to appease bidders interested in acquiring a 46% stake in Zain itself. Should a deal fail to materialise between Zain and Bharti however, it is widely expected that other interested parties may return with alternative offers.