Mega telecom deal hits roadblock

New Delhi

Sept. 13: The South African government taking a cautious stand on the proposed deal between Bharti-Airtel and MTN, underlined the challenges which Sunil Bharti Mittal may face in clinching the deal.
The South African communications minister, Mr Siphiwe Nyanda, told the Johannesburg based weekly Sunday Times that MTN was a “South African company with a footprint in Africa and we are interested that it should remain (here).” He said government would only look at the deal when it was concluded “because it would still have to come to (us) for ratification or support”.
The state-owned pension fund Public Investment Corporation is the largest shareholder in MTN with 21 per cent stake. South African’s consider MTN as a jewel in their crown. MTN is South Africa’s second largest mobile operator, which is still owned by the natives.
“What we have said is that we will not support any agreement that does not take South African interests into consideration and this is a general statement for anybody who wants a (local) company and a (local) brand to give away its South African-ness,” Mr Nyanda was quoted by the newspaper.
He said that the deal could have benefits for the country. But, in a veiled warning, he emphasised that MTN, “through government help”, had expanded in Africa.
The South African government’s stand over the Bharti-MTN deal is quite different from Indian government’s which has supported it. The Union finance minister, Mr Pranab Mukherjee, had said that the deal “has added a new dimension to our South-South cooperation.”
Bharti and MTN revived merger talks in May, a year after previous talks broke down over who would control a merged entity.
Source::DC