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Bharti stock down 3.28 percent as MTN deal gets costlier

by Ians

According to reports, Bharti has offered MTN a 27 percent of its stake for the same money instead of the 25 percent proposed earlier.

The Bharti scrip, which opened at Rs.449, fell Rs.14.50 or 3.28 percent to Rs.428.10. It, however, recouped some losses moving up from its intra-day low of Rs.426.

Under the offer earlier, Bharti had proposed to buy 36 percent of the South African company by offering shareholders half a Bharti share, whereas MTN was to get a 25 percent stake in the Indian company for $2.9 billion and through issuing new shares equal to 25 percent of its share capital.

The potential transaction between the two companies is proposed to create a leading telecom service provider group, aligning Bharti’s market-leading Indian business with MTN’s growing African and Middle Eastern operations.

MTN’s biggest shareholder, with 21 percent, is the Public Investment Corp, a pension fund owned by the South African government.

The country’s treasury and banking officials are supposed to meet Indian government officials Tuesday to discuss foreign exchange control implications of the planned tie-up between MTN and Bharti Airtel.

One of the major contentions in the talks is the dual listing demand made by the South African government to India’s finance ministry.

MUMBAI - The scrip of telecom major Bharti Airtel fell about 3 percent on the Bombay Stock Exchange (BSE) on reports that the company may have to further sweeten its offer for South African telcom company MTN. According to reports, Bharti has offered MTN a 27 percent of its stake for the same money instead of the 25 percent proposed earlier.

Communications ministry not involved in Bharti-MTN deal: Raja

NEW DELHI - Bharti Airtel and South Africa's MTN Thursday said they were extending their talks for a proposed $23-billion financial alliance till Sep 30, with no final pact in sight even as the revised deadline of Aug 31 approaches. "Discussions between the parties regarding the potential transaction continue to progress satisfactorily and the parties have accordingly agreed to extend the exclusivity period until September 30, 2009," Bharti Airtel said in a regulatory statement to the Bombay Stock Exchange (BSE).

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