Bharti-MTN deal may take longer

Written by fe Bureau | New Delhi | Updated: Jul 31 2009, 05:47am hrs
Bharti Airtel and South African firm MTN are yet to stitch together the proposed cash-cum-share swap deal, though the period of exclusive negotiations between the two is ending on Friday. The companies are likely to extend their negotiations by two to three weeks, since due diligence exercises of both are not yet complete.

The companies are expected to issue a statement to this effect on Friday.

When contacted a Bharti spokesperson said, Beyond what we have already communicated in our press note, we have no further comment to offer at the moment.

Bharti Airtel on May 24 had announced that it had once again entered into discussions with MTN for picking up a 49% stake in it while swapping a 36% stake in Bharti Airtel. Out of the 36% share, MTN would receive 25% while MTN shareholders would be allotted 11%. The deal will involve cash and share swap transactions of $10 billion and $13 billion each.

The deal would create a $23-billion entity with over 200 million subscribers in 24 countries.

Meanwhile, while replying to a question in Parliament on Thursday, corporate affairs minister Salman Khurshid said the deal between the two companies have not been finalised

as yet.

Khurshid said any proposal to change the equity shareholding of the company would need government approval.