Bharti, MTN merger talks set to close on weekend

Bharti, MTN merger talks set to close on weekend
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First Published: Sat, May 17 2008. 12 12 AM IST
Updated: Sat, May 17 2008. 12 12 AM IST
New Delhi: Merger talks between India’s biggest mobile phone services firm by subscribers, Bharti Airtel Ltd, and African telecom company MTN Group Ltd are set to close on the weekend, as the two sides put finishing touches to a funding structure, people close to the development said.
“What I hear from the bankers involved with this transaction is that Bharti should be giving details of its bid and explain how the entire transaction would be funded over the weekend,” said a financial analyst who spoke with the people involved in the discussions. The analyst requested not to be identified.
A second person with knowledge of the talks confirmed the timing of the deal’s close, but declined details of the final valuation of the Johannesburg-based company.
According to industry analysts Mint spoke with earlier this week, MTN, Africa’s largest phone firm, may have to be valued at up to $50 billion, or $25 a share (Rs1,065 per share), including debt, about 25% more than its current value on the stock exchange, for a deal to be consummated.
Mint first reported on Thursday that the deal is likely to close on the weekend.
Shares of MTN were trading at around $20.3 toward close of trading Friday on the Johannesburg Stock Exchange. That values MTN at $38 billion. The company has a net debt of around $2.9 billion.
Shares of New Delhi-based Bharti Airtel, which are listed on the Bombay Stock Exchange, were down by almost 0.4% on Friday to close at Rs852.45 a share. The Indian company’s stock has lost 7% since the merger discussions were confirmed by Bharti Airtel and MTN on 5 May.
A Bharti Airtel spokesman declined fresh comment on Friday.
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First Published: Sat, May 17 2008. 12 12 AM IST
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