New structure presented by MTN envisaged Bharti Airtel becoming a subsidiary
Bharti Airtel has called off negotiations with MTN for a possible acquisition of the South African telecom company, for an estimated $45-50 billion. and the first alleges that MTN breached off the agreed terms of transaction. Bharti also stated that MTN presented a completely different structure. The new structure presented by MTN envisaged Bharti Airtel becoming a subsidiary of MTN and exchange of majority shares of Indian company held by Sunil Mittal, promoter of Bharti, family and its foreign partner Singtel, in exchange for a controlling stake in MTN
The company further said that it believes that this convoluted way of getting an indirect control of the combined entity would have compromised the minority shareholders of the company Airtel and also would not capture the synergies of a combined entity. Both the companies were looking forward to create an emerging markets giant and the world’s sixth largest mobile phone company with over 130 million subscribers in around two dozen countries, early in this month. Things were working out throughout this period and conducted in good faith. Bharti also claimed to have tied up funds of over $60 billion with over a dozen banks in the US and Europe. The share’s price were also settled.
Tags: MTN , Bharti Airtel , Subsidiary
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