|
| Bharti-MTN deal has to address stakeholder concerns |
| Bs Reporter / New Delhi May 28, 2009, 00:50 IST |
|
South African securities’ regulation panel rules and the Companies Act, which requires a mandatory offer to minority shareholders once an investor crosses the 35 per cent shareholding threshold, are not applicable to the Bharti Airtel-MTN deal.
For, this is a transaction based on “a scheme of arrangement”, according to sources close to the deal. This entails an understanding between two companies which would eventually require shareholders’ approval through a special resolution.
Some of the minority shareholders of MTN have raised questions on the deal or are keeping quiet now and might do so. Media reports in South Africa say MTN shareholders, including investment management firms like Allan Gray, Polaris, Coronation and Stanlib. South African media reports have, however, quoted Polaris’ Anthony Sedgwick, co-manager of the Nedgroup Investments Rainmaker Fund that owns 6.3 million MTN shares, as saying he does not want the deal to go ahead.
A correction
Our report ‘Bharti-MTN deal will trigger open offer’ (May 28) incorrectly stated that Bharti Telecom, the holding company for telecom service provider Bharti Airtel, will buy a stake in South African telecom company MTN, which in turn will buy a stake in Bharti Airtel.
The structure of the deal announced by Bharti on May 25 said Bharti Airtel will buy 49 per cent in MTN, which in turn will buy a 25 per cent economic interest in Bharti Airtel. Bharti Telecom is not involved in the transaction, therefore the issue of an increase of the promoters' holding in Bharti Airtel would not arise, precluding the need for an open offer. The error is regretted.
|
|
|
|
|
|
|
|
|
|
 Read Business news in |  |
|
|
|
|
|
|
Advertisements |
|
|
|
|
|
|
|
|
|
|
Content Guide
