Bharti starts 40-day talks to acquire Kuwait’s ZainFebruary 15th, 2010 - 1:26 pm ICT by IANS
New Delhi, Feb 15 IANS) India’s largest private telecom services provider, the Sunil Mittal-controlled Bharti Airtel, Monday said it has started exclusive talks to acquire Kuwait’s Zain for $10.7 billion to get a foothold in the African market.
The takeover will not include Zain’s assets in Morocco and Sudan, the company said about the bid — its third such attempt to enter the largely untapped African market after failing to enter into a merger pact with South Africa’s MTN on two occasions.
Africa accounts little over 60 percent of Zain’s 71.8 million customers.
“Bharti Airtel and Zain have agreed to enter into exclusive discussions until March 25 for acquisition of Zain’s Africa unit based on an enterprise value of $10.7 billion,” the Indian company said in a statement.
“This potential transaction does not include Zain’s operations in Morocco and Sudan and remains subject to due diligence, customary regulatory approvals and signing of final transaction documentation,” the statement added.
“There can be no assurance the transaction can be consummated.”
Bharti Airtel is among Asia’s leading telecom services providers with operations in India and Sri Lanka. It had an aggregate of over 118 million customers as of end-November 2009, including 116.01 million mobile customers.
Some of the highlights of the proposed deal with Zain include:
- Offer of $10.7 billion for Zain’s assets
- Deal Excludes Zain’s operations in Morocco and Sudan
- Zain has over 71.8 million customers in 23 countries
- In Middle East, it has 29.9 million and in Africa 41.9 million customers
- Zain is listed on Kuwait Stock Exchange with 100 percent free float
- Its largest shareholder is Kuwait Investment Authority with 24.6 percent
- The company’s consolidated revenue amounted to $6.1 billion last year
Bharti Airtel, which has been on the lookout for an overseas acquisition for over two years now, said last month it would acquire a 70-percent controlling stake in the Bangladesh-based Warid Telecom to expand its global footprint.
The company had late last year failed to strike a deal for the second time with South African telecom giant MTN.
The deal, worth some $24 billion in cash and equity, had called for Bharti to get 49-percent stake in MTN, and the South African firm and its shareholders 36 percent equity in the Indian telecom major.
But the deal got stuck because of the different policies followed by the two countries.
- Kuwait's Zain accepts Bharti's offer for African assets - Mar 24, 2010
- Zain confirms nod to Bharti's offer for African telecom assets - Mar 25, 2010
- India's Bharti makes grand entry into Africa's telecom market - Mar 31, 2010
- Bharti starts fund-raiser to buy Zain's African assets - May 27, 2010
- Kuwait's Zain approves Bharti's bid to connect with Africa (Lead) - Mar 25, 2010
- Bharti to ink final agreement with Kuwait's Zain Tuesday - Mar 29, 2010
- Africa deal makes Bharti world's 5th largest telecom firm - Jun 08, 2010
- Bharti shares open strong after Zain Africa deal - Mar 31, 2010
- Bharti scrip sinks 3.19 percent in afternoon trade - Feb 16, 2010
- Bharti scrip falls another 4.54 percent, loses 13 percent in 2 days (Lead) - Feb 16, 2010
- Bharti is world's 5th largest telecom firm after Africa deal (Roundup) - Jun 08, 2010
- 100 million African subscribers in next two years: Airtel - Nov 16, 2010
- Government will help Bharti clinch Zain deal: Khurshid - Feb 17, 2010
- Bharti Airtel signs network expansion deal with Huawei - Jun 01, 2011
- Airtel ranked best operator by Nigerian telecom regulator - May 11, 2012
Tags: africa unit, airtel, consolidated revenue, countries in middle east, due diligence, enterprise value, foothold, kuwait investment authority, kuwait stock exchange, mobile customers, mtn, New Delhi, overseas acquisition, pact, regulatory approvals, services providers, shareholder, sunil, telecom services provider, two occasions