Bharti plans new company to buy MTN

Tue, 20 May 2008 09:50


India's Bharti Airtel and partner Singapore Telecommunications plan to set up a separate company for the acquisition of South Africa's MTN Group. Those are the latest report from the the Business Standard paper which cited unnamed sources.

The special purpose vehicle (SPV) will raise funds, including bridge loans, and may later sell American Depositary Receipts or Global Depositary Receipts to repay the debt. According to the source the SPV would be a subsidiary of unlisted Bharti Telecom which owns about 45 percent in Bharti Airtel.

MTN would not be offered a stake directly in Bharti Airtel, as that may push foreign ownership in the Indian firm beyond the limit of 74 percent permitted by Indian law.