Bharti Airtel, Rel Comm eyeing controlling stake in MTN

By Sandeep Gurumurthy, CNBC-TV18

 

After the battle for Hutch, the telecom sector could be all set for its next big encounter. The buzz is that Sunil Mittal owned Bharti Airtel and Anil Ambani owned Reliance Communications are both eyeing a controlling stake in African telecom major MTN. CNBC-TV18 finds out if there is fire beneath the smoke.

 

It's been a while since Sunil Mittal wore the hat of Bharti Airtel's CMD in a public forum. And even though the announcement was of a distribution tie-up with IFFCO, Mittal couldn't evade questions on a potential bid for African telecom giant MTN.

 

"We are not making any bid. We are open to opportunities and there is nothing on the table," said Sunil Mittal, CMD, Bharti Airtel.

 

MTN is reportedly having a board meeting on May 5 to evaluate bids. In a communication to the Johannesburg Stock Exchange earlier this week, the company had said, "MTN has not received any specific proposal. MTN receives tentative approaches from time to time, which are always evaluated. MTN has been valued at about USD 41 billion, that is almost as much as Bharti which is valued at USD 44 billion.

 

But analysts believe that at the right price there might be a strategic fit for Bharti. MTN would give Bharti access to emerging markets in Africa and the combined entity's subscriber base will exceed 130 million. But even if Bharti were interested, it will have to out bid the likes of China Mobile and Vodafone.

 

What's more even Anil Ambani-owned RCom could be in the fray. The company's statement on the issue has done its bit in keeping the speculation alive.

 

With both Reliance Comm and Bharti desperately seeking a global footprint, this could well be the war of the titans. But the big question is are they really interested in buying a company that's as big as MTN or are they just testing waters?

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