bharti, mtn tie-up not a 'done deal'

MINISTER of Communications Siphiwe Nyanda has expressed caution over a proposed tie-up between MTN (MTNJ.J) and India's Bharti Airtel (BRTI.BO).

MINISTER of Communications Siphiwe Nyanda has expressed caution over a proposed tie-up between MTN (MTNJ.J) and India's Bharti Airtel (BRTI.BO).

He told the Sunday Times in an interview that any deal should take into account that MTN was a "South African company with a footprint in Africa", and "we are interested that it should remain" here.

The government-owned Public Investment Corporation holds 21 percent of MTN, while the Mikati family from Lebanon, with 10 percent, is the other large owner.

Nyanda said the government "had not come out in support" of a deal, adding it would only look at it when it was concluded because "it would still have to come (to us) for ratification or support".

He noted that MTN had expanded into Africa "through government help".

Africa's biggest mobile phone company needs approval from three quarters of its shareholders to approve the cash-and-share swap, should it reach an agreement to create the world's third-biggest mobile operator.

Small MTN investors want more money from India's Bharti Airtel for the planned multi-billion dollar tie-up, casting doubt over whether they will step in line if the two reach a deal.

The two groups have extended exclusive talks twice and given themselves until the end of the month to decide whether to join forces.

An earlier tie-up collapsed over sensitivities over who would control what and the new deal - in which both companies will hold a large stake in each other's business - seems carefully crafted to avoid a repeat.

But some investors see the deal as being "like a dead horse" because of the long delay in finalising the transaction, while others say they are being short-changed despite Bharti's recently sweetened offer. - Sapa

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