The Hindu Business Line : Bharti says no offer yet on MTN but talks are on

New Delhi, May 6 Bharti Airtel on Tuesday said that it has not made any offer to acquire the whole or part of MTN but has entered into exploratory discussions with the South Africa-based company.

“Further to the statement issued yesterday (Monday) that Bharti Airtel Ltd (Bharti) has entered into exploratory discussions with MTN Group Ltd, Bharti would like to clarify that it has not made any offer to acquire the whole or part of MTN. Therefore, the speculation around a bid by Bharti in a section of the media is incorrect and misleading. Details of any transaction will be released promptly, if and when, the parties reach agreement. As a responsible listed company, Bharti will continue to uphold the highest levels of transparency and corporate governance,” said a Bharti statement.

It was earlier reported that Bharti had made a $19-billion offer for a 51 per cent stake in MTN. Such a bid would have beaten the $13.7-billion purchase by India’s Tata Steel of Anglo-Dutch steelmaker Corus in 2007, making it subcontinent’s biggest-ever foreign takeover.

Bharti Airtel’s statement came after investors expressed concern that a takeover of MTN could put pressure on the company’s balance sheet. However, company sources said that Bharti had enough resources to raise funds for a potential bid. Bharti’s share price dropped 5.29 per cent (Rs 47.25) to Rs 846.60 on the Bombay Stock Exchange.

Meanwhile, market analysts said that MTN would be a good fit for Bharti’s operations.

While MTN has 68.2 million subscribers in more than 20 countries, Bharti has 62 million mobile users. Bharti has been looking to get a foothold into the African market and a deal with MTN will allow the company to gain access to one of the leading emerging markets. However, Bharti may have competition as rival operators Reliance Communications and Vodafone are understood to be considering entering the fray.

In a statement issued on Monday late night, Bharti had said “Bharti Airtel has entered into an exploratory discussion with MTN. Current discussions are still at an early stage, are exploratory in nature and may or may not lead to any transaction.”

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