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MTN ends talks with Egypt’s Orascom on potential deal

MTN ends talks with Egypt’s Orascom on potential deal
PTI
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First Published: Thu, Jun 10 2010. 02 51 PM IST
Updated: Thu, Jun 10 2010. 02 51 PM IST
Johannesburg: South African cellular giant MTN Thursday said that it has terminated its discussions with Orascom Telecom on a potential deal to acquire some or all of its businesses.
“MTN shareholders are advised that discussions (with Orascom Telecom) have been terminated and caution is no longer required to be exercised by MTN shareholders when dealing in their MTN securities,” the company said in a regulatory filing yesterday.
MTN was referring to its announcement in April, regarding its talks with Weather Investments, the parent company of Orascom Telecom, for a possible takeover of the Egypt-based firm or certain of its businesses.
Reportedly, MTN has been unable to strike a deal due to regulatory hurdles.
Orascom operates GSM networks in Algeria, Pakistan, Egypt, Tunisia, Bangladesh and North Korea, among others.
Analysts said that failure of the talk would hit MTN’s plans to expand its reach in the African market.
It also assumes importance in the backdrop of Bharti Airtel recently completing the acquisition of Zain Telecom’s Africa operations for $10.7 billion to become the world’s fifth largest mobile operator with 180 million subscribers in 18 Asian and African nations.
Since 2008, MTN has failed thrice to strike a partnership deal with Indian players, including twice with Bharti Airtel and once with Anil Ambani group firm Reliance Communications.
Recently, media reports had suggested that RCom-MTN talks for a potential deal could be restarted in the wake of the two Ambani siblings calling a truce and deciding to scrap their non-compete agreements.
However, MTN Group spokesperson said, “MTN emphatically denies being engaged in talks of any nature with RCom.”
In July 2008, Anil Ambani-led Reliance Communications (RCom) called off the talks for a potential transaction with MTN, citing legal and regulatory issues. At that time, Anil was engaged in a bitter battle with elder sibling Mukesh.
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First Published: Thu, Jun 10 2010. 02 51 PM IST