India’s Bharti Airtel to Africa’s MTN: No, thanks.
Bharti Airtel, the biggest telecom operator in India, has now officially walked away from merger talks with MTN, a South African mobile firm who is also a big shot in its local mobile industry itself. The reason given by Bharti Airtel is that MTN’s proposal was “completely unacceptable.”
Bharti and MTN agreed on an in-principle agreement on May 16th, and the same was signed on the 21st. But by May 23rd, MTN had changed its mind and was presenting a different structure altogether. This cause Bharti to feel sour about the deal and decide to just call it off.
The merger, if it came through, would have put both companies in the position of sixth-largest mobile company in the world, servicing a total of 130 million subscribers per month. Unfortunately, this would never be, and both companies will just have to work on their own from now on, for Bharti’s stance is firm: “Bharti has decided to disengage from the ongoing talks.”
If MTN hadn’t proposed that Bharti Airtel become a subsidiary of them, and that in exchange for a controlling stake in MTN, Bharti should exchange majority shares held both by them and SingTel, the merger would not have been canceled.
Bharti Airtel looks healthy enough without the merger, anyway, and they even have the courtesy to send MTN a message through their official press release regarding the matter. “Bharti Airtel wishes MTN the very best.”