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Major MTN shareholder, SingTel back Bharti`s bid

Rajesh S Kurup  |  Mumbai 

While the M1 Group, which holds 9.8 per cent in MTN, today backed Bharti's bid, Singapore Telecommunications (SingTel) said it has no objection to the acquisition.

A Dow Jones report from Singapore today quoted Azmi Mikati, CEO of M1, as saying the Bharti transaction "is really combining two great assets into what could become really a unique player in the emerging markets of the mobile industry". He said M1 sees Bharti as a good partner for MTN because of its track record in India. "We have seen what Bharti has done in India and it's exceptional."

On its part, however, SingTel is not keen to dilute its 30.50 per cent stake in the company to finance the Indian major's bid. The Singapore-based major has also assured Bharti Airtel that it will not compete with its Indian partner in the bidding for MTN.

This comes at a time when Bharti Airtel is believed to be considering increasing the offer price to around 175 rand. The company is considering diluting its equity to part-finance the deal though the bulk would be debt financed.

SingTel has also assured Bharti Airtel that it is ready to comply with the "non-compete clause" that is being put forward by MTN, which stipulates that Bharti Airtel by itself or through its competitors should not set up operations in the 21 countries in which the Johannesburg-listed company operates.

Both SingTel and Bharti Airtel declined to comment.

Apart from SingTel, the other stakeholders in the company are Bharti (45.31 per cent) and Indian Continent Investment (4.99 per cent).

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First Published: Sat, May 10 2008. 00:00 IST