Tricky negotiations

7 May 2008 By Una Galani Follow @ugalani

An $80bn mobile tie up between the Indian and South African operators looks easy on paper. Yet there are plenty of stumbling blocks. An Indian billionaire, a sovereign wealth fund, and the politics of black economic empowerment will make negotiations tricky.

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MTN Group, the South African mobile telecom operator, said it had entered into exploratory talks with Bharti Airtel, the Indian mobile group owned by Indian tycoon Sunil Bharti Mittal, which might lead to Bharti making an offer.

Bharti is rumoured to have made an offer for 51% of MTN that values the whole company at around $37bn, according to various newspaper reports. A combined group would have a market value of around $80bn.

MTN has over 61m subscribers, and strong market positions in Africa and the Middle East. It holds 35% of the South African market, where it is the number two operator, and is the market leader in Nigeria, Ghana and Syria.

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