Wednesday, September 23, 2009

India, South Africa to Discuss MTN-Bharti Deal At G20 Summit

South African President Jacob Zuma is expected to push for a quick resolution to the MTN Bharti deal during his meeting with his Indian counterpart Indian Prime Minister Manmohan Singh at the G20 summit in US this week.

The Economic Times reported yesterday that hopes are pinned on this crucial meeting between the two leaders in Pittsburg where the summit will take place.
According to the report the meeting is expected to take place on the sidelines of the G20 summit, President Zuma is expected to raise the issue of dual listed companies (DLCs) with the Indian PM. If Mr. Singh gives an assurance that India will work towards allowing DLCs, the South African government's concerns could be considerably addressed.
But though the Indian premier is likely to indicate his government's support for the deal, it is unlikely that he can provide any sort of assurance on a change of legislation to facilitate dual listing.
Under the terms of the proposed deal, Bharti would acquire a 49% shareholding in MTN. MTN and its shareholders would also acquire an approximate 36% interest in Bharti, of which 25% would be held by MTN with the remainder held directly by MTN shareholders.
The potential transaction between would create a telecommunications service provider group with huge footprints on the Indian sub-continent, as well as within Africa and Middle East. The merged organization would boast a footprint in around 30 countries, with revenues over USD20 billion, and more than 200 million subscribers.

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