KUWAIT CITY, Feb 13, (RTRS): Bharti Airtel has offered up to $10.7 billion for the African assets of Kuwaiti telecom group Zain, Kuwaiti newspapers reported on Saturday, as India’s largest mobile operator makes a renewed foreign push.
Zain’s board is expected to meet soon to discuss Bharti’s offer, local daily al-Rai said in an unsourced report.
Officials at both firms were not immediately available for comment.
Bharti has resumed its hunt for emerging market acquisitions after its planned $24 billion merger with South Africa’s MTN failed in September, the second time the a proposed deal between the two had collapsed in just over a year.
In October, Akhil Gupta, deputy group CEO at the mobile operator’s parent, said Bharti would look at buying a stake in Zain if there was an opportunity.
Ownership of Zain and its assets in Africa have been the subject of much speculation and uncertainty since August last year when news of a potential sale emerged.
Zain, the third-largest telecoms operator in the Arab world, in October halted talks to sell the African assets to appease potential buyers of a 46 percent stake in the parent company, Zain Group.
A consortium of Asian investors has been seeking to the stake from Kuwaiti family conglomerate Kharafi Group for KD 2 per share, or about $13.7 billion.
Shares in Zain have surged as much as 23 percent since Feb. 4 and rose 3.9 percent on Thursday, ahead of the Middle East weekend.
On Monday, Zain said in a statement on the Kuwaiti bourse website that it has not received any offers for the sale of its Zain Africa assets.
Three days later, Zain appointed Nabil bin Salama as the firm’s new chief executive, replacing Saad al-Barrak.
Al-Barrak, who was seen as the driving force behind the company’s growth into 23 countries across Africa and the Middle East, resigned from Zain earlier this month amid uncertainty about the fate of the sale of the parent company stake.
Shares in Bharti closed on Friday at 314.4 rupees, valuing it at about $25.8 billion.
In another unsourced report, Kuwaiti al-Watan newspaper said that the firm’s board is due to meet on Sunday to discuss the Bharti offer.
Kuwaiti telecom firm Zain has received an offer of up to $10.7 billion for its African assets from Indian telecoms firms Bharti Airtel, Kuwaiti newspapers reported on Saturday.
Following are some facts about Zain:
n Zain said on Feb 8 had not received any offers for the sale of it Zain African assets
n In October CEO said it halted talks on the sale of its African assets to appease parties interested in buying a stake in Zain.
n Vivendi, Europe’s largest entertainment group Vivendi, on Sept 1 ruled out reviving talks with Zain, Kuwait’s biggest mobile operator.
n Zain’s shareholders voted on Monday Aug, 31 to remove a cap on share ownershops at an extra-ordinary meeting. Both local and foreign investors can now own any amount of shares in the firm after the amendment, without limit.
n Barrak said at the end of August that Zain was in talks to sell a stake in its African operations and “all scenarios are possible”.
n In August, two banking sources said Reliance Communications started talks to buy Zain’s African operations.
n Gulf Arab rival Etisalat has said it was interested in taking a 51-percent stake in Zain at the right price, but said it had not made a formal offer.
n Zain has spent billions to expand in the Middle East and Africa and operates in 23 countries. Kuwait’s sovereign wealth fund is Zain’s biggest shareholder with a 24.6 percent stake. Family-owned conglomerate Kharafi Group is second behind the fund, with 13.7 percent.
n Zain reported revenue of KD 2 billion ($6.96 billion) and net profit of KD 322 million in 2008. Current liabilities stood at KD 1.5 billion at the end of March.
n Until recently, Zain has only known a course of aggressive expansion with a focus on customer growth even when investments weigh on its bottom line. Last November, Chief Executive Saad al-Barrak said it would spend up to $4 billion to further expand, naming countries such as Zimbabwe and Mali as targets.
n In May, Zain announced a rare cut of 2,000 jobs of its 15,500 workforce, signalling that the expansion heydays might be over. Zain has spent more than $12 billion alone to expand in Africa since 2005.