Page last updated at 13:17 GMT, Sunday, 25 May 2008 14:17 UK

Bharti ends tie-up talks with MTN

Indian woman holding mobile phone
Bharti wants to expand beyond the Indian mobile phone market

India's leading mobile phone operator Bharti Airtel has ended takeover talks with South African phone business MTN.

Negotiations broke down after the two companies failed to agree on the structure of the combined entity, according to Bharti.

A tie-up would have created the world's sixth-largest mobile phone operator with more than 130 million subscribers.

MTN is now holding talks with Bharti's domestic rival Reliance Communications about a deal, press reports suggest.

New Delhi-based Bharti said that a price for MTN shares had been agreed and it had secured funding of more than $60bn (30.3bn) from more than a dozen US and European banks.

But the firm abandoned its plans to buy MTN after the South African company proposed a different merger structure from the one that had been originally agreed.

This would have seen Bharti Airtel become a subsidiary of MTN and exchange of majority shares of Bharti Airtel held by the Bharti family and Singapore telecoms group Singtel, in exchange for a controlling stake in MTN.

'No synergies'

"Bharti believes that this convoluted way of getting an indirect control of the combined entity would have compromised the minority shareholders of Bharti Airtel and also would not capture the synergies of a combined entity," Bharti said in a statement.

"Accordingly, Bharti has decided to disengage from the ongoing talks and has conveyed the same to MTN," it added.

Bharti's departure opens the door for other telecoms groups to make a bid.

Sub-Saharan Africa is one of the world's fastest growing markets for wireless services and MTN is the biggest operator in that market.


SEE ALSO
Telecom boom boosts Bharti Airtel
23 Jan 07 |  Business
Bharti African talks 'continue'
16 May 08 |  Business

RELATED INTERNET LINKS
The BBC is not responsible for the content of external internet sites


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

BBC navigation

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific