Cape Town/New Delhi: South Africa’s communications regulator said it might not grant approval for the proposed tie-up between mobile phone group MTN and Bharti Airtel this year.

Paris Mashile, chairman of the Independent Communications Authority of South Africa (Icasa), also told Reuters on Tuesday the regulator would not talk to MTN about any deal until “all the documentation and facts and everything" were ready.

Talk time: A file photo of a customer at the MTN headquarters in Johannesburg, South Africa. The Bharti-MTN transaction is subject to an end-September deadline set by the companies. Nadine Hutton/Bloomberg

The Bharti-MTN transaction, which would create the world’s third largest mobile group by subscribers, is subject to an end-September deadline set by the companies.

But the two have extended talks twice before, and a person with direct knowledge of the matter said on Monday it was possible the talks could be further extended by a few days.

South Africa is pressing India for an agreement on the dual listing of companies before the end-September deadline, The Economic Times reported on Tuesday.

The Indian government said on Tuesday it was open to a dual listing by MTN on exchanges in India and South Africa, PTI reported. “There is a provision for the dual listing of companies," finance minister Pranab Mukherjee told reporters in Chennai, the news agency reported.

“The South African minister met me at G-20 finance ministers meeting and there I suggested to him that this arrangement is to be looked into in the Indian context," Mukherjee was quoted as saying.

Bharti and MTN were involved in similar talks last year but failed to reach an agreement, leading to failed negotiations.

Siphiwe Nyanda, South Africa’s communications minister, said on Tuesday that he was not interested in blocking the deal. “What I am saying is all we are interested in is what kind of management agreement outcome results out of this and all we want is that this remains a South African company. That is all," Nyanda said.

MTN, the country’s second biggest mobile operator and the only one still owned by South Africans, was set up with government help in 1994 when apartheid ended as the country’s first black-owned group.

South Africa’s top carrier Vodacom was sold to Britain’s Vodafone and was listed on the Johannesburg bourse in May. That deal narrowly escaped being blocked by powerful trade union COSATU, which feared job losses.

COSATU said on Sunday it would judge the MTN/Bharti deal on its merits, particularly its effect on jobs.

Ranjana Smetacek, a spokeswoman for Bharti Airtel, declined to comment on whether a delay in regulatory approval would be a roadblock for the deal.

One analyst said regulatory problems were always present in cross-border transactions.

“But in this case, it looks slightly strange that South Africa is now saying they are cautious over the deal after so many days of negotiations. But anyway, Bharti, MTN have to answer all questions raised by regulators and the government there," said R.K. Gupta, managing director at Taurus Asset Management in New Delhi.

“So the deal is going to get stretched and a further extension in talks cannot be ruled out," Gupta added.

Bharti has increased the cash component of its offer for a 49% stake in MTN to $10 billion (Rs48,600 crore) from a proposed $7.6 billion, two people familiar with the matter said last week.

On top of that, Bharti would pay $4 billion in stock for a total package of $14 billion, 7% more than the earlier $13 billion proposed deal.

MTN shares were up 0.3% at 123.94 rand by 5.30pm, outperforming a flat JSE Top-40 index, while Bharti shares closed 0.8% weaker at Rs416.05. Reuters

Gugulakhe Lourie in Johannesburg and Tony Munroe in Mumbai contributed to this story.