Airtel plans bid for Tigo

airtel

India’s Bharti Airtel plans to bid for telecom operator Millicom’s Sri Lankan mobile network Tigo. The move would make it the second largest mobile phone operator in the island nation, trebling its user base from one million now.

A spokesman for Bharti told he would not comment on market speculation. Bharti will have to compete with an array of suitors such as Malaysia’s Axiata Group, Russia’s Vimpelcom and United Arab Emirates Etisalat, which are reportedly interested in Millicom’s Asian assets, including Tigo network in Sri Lanka, the report said.

Millicom International had put its operations across Cambodia, Laos and Sri Lanka on the block in July, the report said. Bharti’s Sri Lankan arm has already invested $125 million in the country against a commitment of $250 million, the paper said.

Bharti is in exclusive talks with South Africa’s MTN aimed at a merger to create the world’s third-biggest telecoms firm.

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4 Replies to “Airtel plans bid for Tigo”

  1. Regulatory hitches threaten Bharti-MTN deal: reports
    NEW DELHI, September 21, 2009 (AFP) – India’s top mobile firm Bharti Airtel and South African cellular flagship MTN are ready to sign a tie-up deal but regulatory issues could stymie a final agreement, reports said Monday.

    “The deal is all set, agreed and legally ready to be signed,” the Business Standard newspaper quoted an unnamed source close to negotiations as saying.
    But the Business Standard and The Economic Times say a final agreement could be blocked by the issue of whether India would allow the merged company to be listed on both the Indian and South African stock exchanges.

    A dual listed company (DLCs) involves two listed companies that have different sets of shareholders but share ownership of a single business operation. South Africa allows dual listing while India does not.

    The South African government, which indirectly holds over 21 percent in MTN, said earlier this month it was unwilling to sacrifice the firm’s “South African character” and raised the possibility of dual listing as a compromise.

    India media reports say the two firms have worked out details of the proposed 23-billion-dollar cash-and-share swap deal. The merged company would have over 200 million subscribers and 20 billion dollars in annual revenues.

    But allowing DLCs would involve substantial changes in India’s foreign exchange and stock market laws and full cabinet approval, the reports said.

    A Bharti Airtel spokesman had no comment.

    The Economic Times said the issue was expected to be raised at a meeting between Premier Manmohan Singh and South African President Jacob Zuma on the sidelines of a G20 summit in the US city of Pittsburgh this week.

    The newspaper said Singh was likely to indicate the Indian government’s support for the deal but added it was unclear whether he could give any assurance on changing India’s legislation to allow dual listed companies.

    The Economic Times quoted Vincent Magwenya, a spokesman for Zuma, as saying the deal’s future was dependent on whether “all regulatory requirements and other considerations in both countries” could be met.
    The 15-year-old MTN is South Africa’s largest telecoms company with 103 million subscribers in 21 countries.

    A merger between the two would create the world’s third-largest mobile phone operator by subscribers that would straddle Africa, Asia and the Middle East.

    Bharti Airtel and MTN say they will engage in exclusive talks on a merger until September 30.

    source : LBO
    http://www.lbo.lk/fullstory.php?nid=1749806396

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