Bharti Denies Merger Talks With Kuwaiti Firm Zain

[KumaarShah 143]

NEW DELHI: India’s largest private mobile firm Bharti Airtel, on Wednesday, denied media reports that it was in talks for a merger with Kuwaiti operator Zain.

Bharti Airtel had recently lost a bid to acquire a controlling stake in South Africa’s largest telecom operator MTN after both companies had failed to agree on the corporate structure of the merged entity.

The Bharti spokesperson said the ‘company vehemently denies being in talks with Zain’. Bharti insiders, whom ET spoke to, also said that there were no truth to reports that Bharti was looking to acquire or merge with MTN.

Zain, along with Egypt’s Orasom, are the main rivals to South Africa’s MTN in Africa and West Asia. The Kuwaiti telecom operator functions in 22 countries, 7 Middle Eastern and 15 sub-Saharan African countries (inclusive of the recent signing of Westel in Ghana), and is the world’s fourth-largest operator if the geographic parameter were to be considered. It has a market cap of $25.8 and has over 46 million customers.

Zain began its African operations by acquiring Celtel in 2005 for $3.4 billion for which it had entered into a bidding war with MTN.

Despite its failure to lure MTN, Bharti Airtel sources say that the company is open to new avenues to expand its presence globally and is looking at overseas buys in an effort to export its low cost business model to the developing markets.

In India, Bharti, which is 30.5% owned by Singapore Telecommunications, has more than 66 million subscribers. It is the market leader as it commands a lead of 17 million more customers over Reliance Communications, its closest rival.

Ever since the talks with MTN collapsed, Bharti has been linked to several other telecom majors such as Orascom, which has over 75 million customers and Millicom, which has operations in 16 countries spread across Central and South America, Africa and Asia.