BHARTI AIRTEL AND MTN MERGER PDF

History[ edit ] In , Sunil Mittal started assembling push-button phones in India, [14] which he earlier used to import from a Taiwan company, Kingtel, replacing the old fashioned, bulky rotary phones that were in use in the country then. By the early s, Bharti was making fax machines, cordless phones and other telecom gear. In , he successfully bid for one of the four mobile phone network licences auctioned in India. So, Mittal clinched a deal with the French telecom group Vivendi.

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By Heather Timmons Sept. The two companies have been in intensive talks for about four months, but the deal was ultimately derailed by the South African and Indian governments, according to people on both sides of the transaction. But striking deals can be difficult because of immature capital markets and hands-on governments, which make corporations less independent than their counterparts in developed economies.

In this case, protectionism may have gotten the upper hand. While management from both MTN and Bharti were ready to move on a deal, the two governments were not, said analysts, executives and deal makers involved in the talks. Heavy government intervention had not been anticipated because both companies are publicly traded and controlled by investors.

But the South African government, under Jacob G. Zuma, who became president in May, has been jockeying to maintain and create national corporate icons, say bankers who do deals in the country. They were not willing to immediately change rules about dual-listings, said people involved. Regulators and finance officials from South Africa visited India last week to meet with their counterparts here, but the two groups could not reach a compromise.

Many other countries have no such dual-listing prohibitions, and MTN will probably attract the interest of telecommunications companies in other emerging market countries, analysts say. Last year, Bharti and MTN discussed a tie-up for several weeks before Bharti suddenly called off talks.

At the time, Bharti approached MTN about a deal that would essentially be a takeover. MTN, which is the largest or second-largest telecommunications company in 21 markets in Africa and the Middle East, will most likely be the target of another takeover offer from outside India, analysts said.

China Mobile or a Middle Eastern carrier are probable buyers, they say.

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Bharti and MTN Abandon Talks on Potential Merger

Perhaps to avoid government objections, the talks between the companies were described as leading to a partnership, though a merger at a later date was not ruled out. The period for exclusive talks between the companies was scheduled to end Wednesday, after two earlier extensions. The broad structure discussed had taken into account the sensibilities and sensitivities of both companies and their countries, including ensuring continuity of business in areas such as management, brand and stock listing, Bharti said. The companies said in May that a full merger between them was a broad strategic objective, as soon as it was practicable, indicating that the immediate focus of the talks was on a loose partnership and cross-investments between the two companies.

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Bharti Airtel, MTN restart talks on merger

By Heather Timmons Sept. The two companies have been in intensive talks for about four months, but the deal was ultimately derailed by the South African and Indian governments, according to people on both sides of the transaction. But striking deals can be difficult because of immature capital markets and hands-on governments, which make corporations less independent than their counterparts in developed economies. In this case, protectionism may have gotten the upper hand. While management from both MTN and Bharti were ready to move on a deal, the two governments were not, said analysts, executives and deal makers involved in the talks. Heavy government intervention had not been anticipated because both companies are publicly traded and controlled by investors. But the South African government, under Jacob G.

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Bharti Airtel and MTN Call Off Alliance Talks

This deal structure needed an approval from the government of South Africa, which has expressed its inability to accept it in the current form. Thereafter, the MTN board met and formally called off the deal. Such arrangements are also seen protecting the national identities of companies. ET was the first paper to flag off the issue of dual listing as a major stumbling block for the deal in its edition dated July 31, Bharti has not given up yet In the end, the politics of national pride derailed the deal as South Africa did not want MTN to lose its independent identity.

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Bharti Airtel, MTN in $23 billion merger deal talks

The two had discussed a merger last year but talks broke down over control of the combined operation. Bharti Airtel confirmed in a statement that the two are now in talks for the Indian company to acquire a 49 percent stake in South Africa-based MTN. Bharti and MTN have agreed to discuss the potential transaction exclusively with one another until 31 July. Bharti said the broader strategic objective would be to achieve a full merger of MTN and Bharti as soon as it is practicable. Such a merger would create an operator with over USD 20 billion in annual sales and more than million customers. Each GDR would be equivalent to one share in Bharti and would be listed on the Johnannesburg stock market.

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