All signals point to an imminent sale of Zain Africa to Bharti this week. Several reports confirm that Bharti’s board met this Saturday and approved of the plan to acquire Zain Africa ahead of the March 25 exclusive talks deadline. Zain’s sell curse and Bharti’s buy curse will finally come to an end. Bharti failed in two previous attempts to acquire Africa’s largest operator MTN. Zain has also failed to sell Zain Africa and itself in the past.
Last week reports suggested complications surfaced in relation to Zain’s Nigeria operations. Econet Wireless Holdings is disputing control of Zain’s unit in Nigeria and it is particularly significant as Nigeria contributes 21% of Zain’s earnings. However, such concerns were assuaged as there are indications Bharti Airtel may simply ask Zain for legal protection from a dispute in Nigeria. Further, Bharti might put part of the purchase price in an escrow account to protect it from potential problems.
Sources even indicate that Bharti Airtel has issued a term sheet to banks to raise up to US$ 8.5 bn in offshore loans to fund the Zain acquisition deal. Bharti is said to have received “strong response” from offshore lenders. According to analysts, the acquisition of Zain Africa would increase Bharti’s debt from 0.4 times EBITDA (earnings before interest, tax, depreciation and amortization) to around 2.5 times. However, this would still be a lower debt multiple that that of its Indian competitor Reliance Telecom.
(1 votes, average: 4.00 out of 5)
Loading ...Tags: Bharti, Bharti Airtel, India, Kuwait, Zain, Zain Africa, Zain Nigeria, Zain sale
Call me cynical, but I don’t see the deal going thru!
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Raad Reply:
March 21st, 2010 at 10:44 pm
I have the same feeling.
Please call in the Chinese, for change !
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Lol well lets hope it goes through cuz the kuwaiti market really needs it!
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Im so sure this deal will not go though fully intact…
but i hope i’m wrong!
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Keynesian Reply:
March 28th, 2010 at 10:28 am
Limit downs today say u may be right..
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The suspense with Bharti/Zain is making me sick, literally
!!!
Is this deal going to close the way people think it is supposed to? Because if not, then I think the winners will be Zain and Bharti … somehow, some way…
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I’m positive toward it, I think that the deal will go through
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I ll tell you what will happen:
Just the same scenario as when Kathma FC played Barcelona. Charging 100kd for seats and then only getting to see the third lineup play!
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According to the latest news pertaining to the deal:
India’s Bharti Airtel and Kuwait’s Zain are likely to sign agreements for the Indian firm’s $9 billion buy of Zain’s African assets on Tuesday, two sources said. The agreements will be signed in Amsterdam, the base of the target unit Zain Africa BV, one of the sources said.
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