Sources said theres not much scope for any further offers, as the South African rand has appreciated against the dollar. A Bharti spokesperson declined to comment on the matter.
For the Bharti-MTN deal to finally go through, shareholders holding a combined 75% in MTN must approve the deal. However, in South Africa, while declaring the companys half-yearly results, the MTN CEO said, No decision has been taken or agreement reached by either companys board to implement any potential transaction or stake sale with Bharti. The MTN statement, however, added, The rationale for the transaction was compelling and included diversification and synergy benefits.
The announcement comes barely four days after MTN president and CEO Phuthuma Nhleko and Bharti Airtel chairman Sunil Mittal met finance minister Pranab Mukherjee to apprise him of the ongoing negotiations between the two companies. Mukherjee told FE on Wednesday that there were no regulatory hurdles for the proposal.
The two chiefs are also believed to have discussed the complex structure of the deal and that if the deal materialises, it would be in accordance with the new FDI norms.
Bhartis additional offer is an effort to placate MTN investors, who were unsatisfied with the deal. South Africas Public Investment Corporation (PIC), a shareholder, has in the past indicated it might hold out for a higher price, as it felt Bharti needed to pay a bigger premium for effective control of MTN.
The two companies have been in negotiation for creating a $20-billion entity, wherein Bharti Airtel would acquire a 49% stake in MTN while swapping its 36% stake.
Coming to the companys results for the six months ended June 30, MTN clocked a 24.2% increase in revenue at $7.28 billion as compared to the same period a year ago. The companys subscriber base climbed 14% to touch 103.2 million from December.