SA delegation in India to discuss regulatory issues

SA delegation in India to discuss regulatory issues
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First Published: Mon, Sep 21 2009. 10 50 PM IST
Updated: Mon, Sep 21 2009. 10 50 PM IST
Johannesburg: South African finance ministry and central bank officials are travelling to India on Monday to discuss the proposed $24 billion (Rs1.17 trillion) deal between MTN Group Ltd and Bharti Airtel Ltd.
The South African officials, who will meet their Indian counterparts and regulatory authorities, will be in India until 26 September, a treasury official said. South Africa will ask the Indian government to allow Bharti to have a dual listing in Johannesburg so that its shares, and not depositary receipts, can be traded in South Africa, The Economic Times reported on 15 September. Indian law currently does not allow for dual listings, according to the newspaper.
“We will be discussing regulatory matters related to the deal in Delhi and Mumbai,” Thoraya Pandy, a spokeswoman for the South African treasury, said in an emailed response, without confirming the dual listing report.
MTN and Bharti have been in exclusive discussions since 25 May on a tie-up that would create the world’s third biggest cellphone firm with about 200 million subscribers. The proposal envisages a cash and share swap between MTN and Bharti. Bharti sweetened its bid to buy 49% of MTN by raising the cash portion of its $14 billion offer, three people familiar with the matter said.
MTN and its shareholders are set to buy 33% of Bharti for about $10 billion, the people said, asking not to be named before an announcement this month.
MTN minority shareholders would have the option of a stock-and-cash or an all-cash payment. South African law restricts the level of institutions’ holdings in firms registered outside the country. If they opt for the stock-and-cash option, they would be forced sellers of the Bharti stock they received as part of the deal, some minority shareholders have said.
Pandy did not immediately respond to requests for confirmation that a dual listing is being sought by the South African government. Firms have won South African government approval to reorganize their businesses or sign up new shareholders by creating dual-listing structures. Anglo American Plc’s former subsidiary Mondi Ltd, which is listed in Johannesburg and London, is one such case.
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First Published: Mon, Sep 21 2009. 10 50 PM IST
More Topics: MTN | Bharti | Airtel | South Africa | Mondi Ltd |