MTNL eyes TelOne, but no bid until end of year?

19 Jul 2011

Indian state-run telco Mahanagar Telephone Nigam Ltd (MTNL) is eyeing a 51% stake in Zimbabwe’s state-owned landline operator, TelOne, for an undisclosed sum, a senior MTNL executive told India’s Economic Times. ‘The Zimbabwe government is keen to offload a 51% stake in TelOne … Since TelOne also has a GSM mobile permit, it fits well with our plans to enter the African cellular turf in the near future,’ said the executive. If the deal goes through, the purchase will be routed via Mahanagar Telephone Mauritius Ltd (MTML). TelOne has considerable debt and requires an overseas investor to finance a launch into the cellular sector. It is in the process of upgrading fibre-optic transmission infrastructure, although the process has been slowed significantly by lack of funding. In 2006 MTNL failed to secure a mobile licence in Kenya, and a year later it lost out in its bid for a controlling stake in Telkom Kenya. According to the Times, Sanjay Garg, head of MTML, confirmed the discussions with the Zimbabwe government but said any potential deal would only happen after the Mauritius company’s imminent GSM service is firmly established – by around the end of this year.