Reliance Communications and MTN may swap shares

South Africa's MTN Group and Reliance Communications are discussing a possible combination, just days after India's top mobile firm Bharti Airtel ended talks with MTN after failing to agree how to structure a deal.The Two companies may swap shares or take big stakes in a new company as regulatory hurdles and both firms' global ambitions seem to rule out a $66 billion emerging markets telecoms merger.

Analysts said Reliance Communications' chairman, Anil Ambani, who owns two-thirds of India's No.2 mobile operator,like Bharti Airtel would also not want to cede control, casting doubt on media reports that MTN, valued at around $38 billion, planned a reverse takeover of Reliance, which has a market value of about $28 billion.

The two firms might transfer shares to a separate entity in which they would both hold significant stakes, or swap shares in a way to get around potential regulatory hurdles.MTN could take a stake of below 15 percent in Reliance Communications, avoiding having to make an open offer for a further 20 percent, and Reliance could take a minority stake in MTN that avoids regulatory triggers.

Read more in The Economic Times article.

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RCom, MTN in exclusive talks over merger
Bharti may rope in SingTel for MTN buy

RCom, MTN in exclusive talks over merger

Anil Ambani group company Reliance Communications on Monday announced entering into an exclusive negotiations with South Africa's telecom giant MTN to discuss potential combination of their businesses.

The development comes just two days after South African company deviated from agreed terms with India's largest telecom player Bharti Airtel, who pulled out of 3-week long negotiations.The two companies have agreed for a 45-day exclusivity to work out the details for merging their businesses.

If the negotiations are successful, the combination of MTN and Reliance Communications would create a global wireless juggernaut, larger even than developed-market giants such as AT&T.

Last week, Bharti Airtel had decided to pull out as MTN had proposed a structure which would have made the Indian telecom giant a subsidiary of South African company, contrary to the agreed terms between the two firms prior to entering the discussions.

Read more in The Economic Times article.

Two European bids in MTN fray

The race for South African telecom major MTN Group is hotting up with the possibility of two other players evaluating a bid or a strategic relationship with the company. Banking sources say European telecom major Deutsche Telekom and Russian telco Vimpel Communications are also studying the possibility of talking to the MTN Group.

With over 50 million customers, Vimpel Communications has a market capitalisation of $42.5 billion, which is similar to MTN. The company operates in various markets in Russia and the CIS countries, which include Kazakhstan, Ukraine, Georgia, and Armenia, amongst others, under the "Beeline" brand name.Deutsche Telekom has over 106 million mobile customers and operates in Germany, the US, the UK, Austria and the Netherlands, amongst others. It has a market capitalisation of $74 billion.

Read more in The Business Standard article.

Bharti Airtel, SingTel to float SPV for MTN

Billionaire Sunil Mittal, the founder of Bharti Airtel, plans to set up a separate company in partnership with Singapore Telecommunications (SingTel) that will be the vehicle for acquisition of the South Africa-based MTN Group.

The special purpose vehicle (SPV) will raise funds, including bridge loans. The company will later explore the option of selling American depository receipts (ADRs) or global depository receipts (GDRs) to repay the bridge loan.The SPV may be registered in a tax-haven country, like Mauritius or Bahamas.

The move to float an SPV will help Bharti Airtel to continue being listed on Indian stock exchanges, while MTN's promoters will be given a stake in the SPV. The quantum of the stake will depend on the cash-share ratio, which is yet to be finalised between Bharti and MTN. Bharti Airtel would raise funds by diluting the equity of the SPV and, if needed, the promoters' stake in Bharti and that of its partner SingTel to part-finance the deal.

Read more in The Business Standard article.

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Bharti, MTN in talks for 50:50 cash-share deal
Bharti may rope in SingTel for MTN buy

Bharti, MTN in talks for 50:50 cash-share deal

The top managements of Bharti Airtel and South African telco MTN Group and the Lebanon-based Mikati family (which holds 9.8 per cent) are looking at a 50-50 cash-and-stock deal option as part of possible merger talks against an earlier 60:40 structure.

Banking sources said with the MTN shareholders asking for a higher price than what Bharti had initially offered, the Indian telecom company might now pay 50 per cent of the money in cash and the rest through shares in Bharti Airtel.

MTN is also believed not to favour signing an "exclusivity" contract with Bharti Airtel under which it would be bound not to talk to any other competing bidder till the negotiations with them have been concluded.Issues relating to who will be the chairman of the merged entity — Bharti's Sunil Mittal or MTN group Chairman M C Ramaphosa — are also under discussions.

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Bharti may rope in SingTel for MTN buy

Bharti seeks Middle East funds for MTN bid

Bharti seeks Middle East funds for MTN bid

Leading mobile operator Bharti Airtel Ltd has contacted Middle Eastern sovereign wealth funds in a search for additional cash to back a bid for a majority stake in South Africa's MTN Group Ltd, a media report said on Tuesday, citing people familiar with the situation.

However, there is no agreement yet, the report said. Bharti, which has said it is in talks with MTN but has not yet made any bid, is reported to be considering offering 160-165 rand a share for a 51 per cent stake in MTN that would cost $19 billion.

A person familiar with the talks said that late last week that Bharti may raise that to 175 rand per share. The sources have said that Bharti has already negotiated about $12 billion in financing from a group of banks that includes Standard Chartered PLC.

Read more in The Economic Times article.

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Bharti may rope in SingTel for MTN buy
SingTel involved in Bharti-MTN bid talks

SingTel involved in Bharti-MTN bid talks

Singapore Telecommunications Ltd is actively involved in the takeover talks between India's top mobile firm Bharti Airtel Ltd and South African operator MTN Group Ltd, a source familiar with the situation said on Monday.

However according to sources it was premature to speculate if SingTel -- which is Bharti's largest shareholder with over a 30 percent stake -- would provide any form of financial support to Bharti for the bid as the deal was evolving.

SingTel, Southeast Asia's largest phone company, declined to comment.Bharti also said in a separate statement it had not made any offer to buy the whole or part of MTN.

The Asian Wall Street Journal, quoting an unidentified source, said on Monday that Bharti was considering raising its offer to around 175 South African rand ($22.63) a share for control of MTN, and an official bid could come this week.

Read more in The Economic Times article

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MTN sets terms for deal with Bharti
Bharti may rope in SingTel for MTN buy


Also read related story in The Economic Times article.

MTN sets terms for deal with Bharti

Negotiations between the top management of Bharti and MTN are entering a crucial phase. MTN, it is learnt, has put forth a condition that the South African telco’s CEO and group president, Phuthuma Nhleko should be the chief executive of an integrated management committee, combining top executives of both the firms, in case the Indian company manages to emerge as the acquirer.

The discussion on an integrated management committee signals that top honchos of MTN, including Mr Nhleko, could be interested in acquiring shares of Bharti Airtel. The MTN management, including Mr Nhleko, holds 13% stake in the company.

Bharti’s plan to acquire a majority stake might cost it over $20 billion, going by MTN’s market capitalisation of $40 billion. Bharti has commitments from Standard Chartered Bank and Goldman Sachs for loans of $12 billion. Other banks may join the consortium as the discussions progress.

Read more in The Economic Times article.

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Bharti may rope in SingTel for MTN buy

Bharti may rope in SingTel for MTN buy

India's largest private telecom company Bharti Airtel is believed to have held discussions to rope in Singapore Telecommunications Ltd (SingTel), which directly and indirectly holds 30.5 per cent in the company, to bid for South African telecom major MTN Group.

MTN's largest shareholder with 23 per cent is the Alpine Trust, which is controlled, in turn, by two shareholders that have pooled their shares in the trust.One is Newshelf664, a company floated by MTN staff and management and the other is M1, controlled by the Makati family. The other major shareholder is PIC, a South African government-owned pension fund, which has 13.5 per cent. The rest of the shareholding is widely dispersed.MTN is listed on the Johannesburg stock exchange.

An initial entry in the company might be through the buyout of the Alpine Trust stake. Alpine has a market capitalisation of around $33 billion. If Bharti considers buying 51 per cent, the bill will be over $20 billion (Rs 80,000 crore).Goldman Sachs is believed to have agreed to provide debt of up to $12 billion, while the remaining will be taken care of by Stanchart by issuing Bharti's equity to MTN shareholders.

RCOM to offload 10% in tower arm via IPO

Reliance Communications is likely to list its tower arm — Reliance Telecom Infrastructure Ltd (RTIL) — by March. The company which has already offloaded 5% stake in RTIL to outside investors, plans to sell an additional 10% in the company through an IPO.

The valuation of the company as per its 5% equity placement in July to seven institutional investors from the US, Europe and Asia was about Rs 27,000 crore. It is also learnt that the promoters (Reliance Communications) will sell shares and therefore there would not be a fresh issue of equity.

RCOM’s primary competitor Bharti Airtel, which is currently in the process of transferring its mobile telecom towers and related infrastructure to Bharti Infratel, has already prepared a road map which would allow the company to divest a majority stake in its tower arm in the future.

After the completion of the demerger, Infratel will enter into comprehensive sharing agreements with other service providers while Bharti in time would divest a majority stake and may also go for an IPO, thus making it a completely independent company, Bharti Airtel chairman Sunil Mittal said.

DLF shares rise 11%; 8th most valued firm

Shares of DLF Ltd jumped 10.85 per cent in the real estate major's second coming to the capital market, making it the eighth most valued firm on the bourses in terms of market capitalisation.

The scrip listed at Rs 582 on the Bombay Stock Exchange against the issue price of Rs 525 and soared to a high of Rs 714.25, briefly propelling the market value to over Rs 100,000 crore.

Billionaire KP Singh-promoted DLF, which had delisted from Bombay Stock Exchange in 1982, was ahead of ICICI Bank and State Bank of India in terms of market cap. Only Reliance Industries, ONGC, Bharti Airtel, NTPC, Infosys, TCS and Reliance Communications had higher market value on BSE.

In the first 15 minutes of trade, the scrip reported turnover of around Rs 330 crore as around 60 lakh shares changed hands on the BSE.The company had offered 17.5 crore equity shares through 100 per cent book-building process. The proceeds of the issue, which got oversubscribed 3.5 times, would be deployed to meet costs of construction, land acquisition and repayment of debt.

Read more in The DNA Money article.

Spice Communications raises $128 mn from public issue

Spice Communications Ltd, an Indian mobile phone venture partly owned by Telekom Malaysia Bhd., raised Rs520 crore ($128 million) in an initial public offering as investors try to tap a market whose numbers almost doubled in 2006.

The Noida-based company priced the 113.1 million new shares at Rs46 apiece, the top end of a Rs41-46 range, according to an email sent to investors. The stock will trade on the Bombay Stock Exchange.

The mobile operator and larger Indian rivals, led by Bharti Airtel Ltd and Reliance Communications Ltd, are attracting investors trying to get access to the world’s fastest-growing market last year. Spice, which offers its services in the southern state of Karnataka and Punjab in the north, plans to spend $140 million during the next two years to boost coverage.

Last month, Spice sold stakes worth $10.1 million each to Lehman Brothers Holdings Inc. and Spinnaker, the company said.Enam Financial Consultants Pvt. Ltd and UBS AG arranged the Spice share sale.

Read more in The Livemint article.

SingTel/Bharti can buy Temasek's Airtel stake

Singapore Telecom (SingTel) and Bharti Enterprises, the top two shareholders of Bharti Airtel, will have the first right to buy the stake acquired by Singapore government's investment arm Temasek in the mobile company.

Temasek has been granted an option to indirectly acquire 4.99% in Bharti Airtel.SingTel, which owns 30% in Bharti Airtel, today said it along with Bharti Enterprises have the first right of refusal to the shares bought by Temasek in the mobile firm.

"Should Temasek decide to exercise its option to purchase the shares from Bharti and should Temasek decide to sell these shares thereafter, Bharti and Singtel have the first rights," a SingTel spokesperson told PTI.

A Bharti spokesperson said Temasek, after it exercises the option to acquire the stake in Bharti Airtel, will be bound under the agreement that at the time of exit it has to sell these shares to either one or both Bharti and SingTel. It cannnot sell the stake to any third party.

Read more in The Business Standard article.

Bharti says offers 5 pct equity to Temasek

The Bharti group said late on Tuesday that it had offered 5 percent equity in Bharti Airtel to Singapore's Temasek Holdings.

The group's Bharti Enterprises will hold a controlling 45 percent stake in Bharti Airtel, India's top mobile services firm, it said in a statement.

It said a subsidiary of Temasek would have the option to acquire a stake of up to 4.99 percent in Bharti Airtel.

Vodafone to transfer Bharti stake by Nov '08

Vodafone, which acquired controlling stake in mobile firm Hutch-Essar, today said it will transfer its 5.6% stake in Bharti Airtel back to the Indian mobile leader by November next year.

Following acquisition of control in Hutch-Essar for $10.9 billion in cash, Vodafone had entered into a share sale agreement with Bharti regarding its 5.6% equity holding in the company.

"The shareholding will be transferred in two tranches, the first before March 31, 2008 and the second by November 2008," Vodafone said in a statement after announcing its annual results for the year ended March 31.Vodafone completed the purchase of the Hutch-Essar stake from Hong-Kong based Hutchison Telecom International (HTIL) on May 8.

Read more in The Business Standard article.

MTNL may bid for 26% in Telkom Kenya

The Kenyan government had recently invited bids for the 26% stake in the state-owned landline company, which has about 300,000 customers and an average revenue per user of about $40 per month. The successful bidder will be announced on September 25 and the dateline for signing the deal is October 17. Kenya also plans to sell additional 34% stake in Telkom Kenya through an IPO after identifying a strategic partner for the company.

MTNL, which offers both fixed line services in Mumbai and Delhi, plans to bid for 26% equity stake in Telkom Kenya. According to MTNL sources, the company was planning to bid for the 26% stake for Telkom Kenya as it had lost the bid to acquire a mobile license in the African country last year.

The IPO date will be finalised only after consultations with the successful bidder for the 26% stake. The International Finance Corporation is the transaction advisor to the Kenyan government for the deal.

Read more in The Economic Times article.

Bharti to invest $8b by 2010

Striving to retain the leadership position in the mobile industry, Bharti Airtel will invest a massive $8 billion by 2010 to have a 25% market share.

The aggressive expansion programme assumes importance in the wake of imminent entry of global mobile leader Vodafone through acquisition of Hutch-Essar, an announcement after which Mittal had said that Bharti would continue to be the numero uno player in India.

Read more inThe Times of India article.