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    Bharti-Zain Deal Bharti - Zain Deal: By: - Vivek Yadav By: - Vivek Yadav

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    Akshat Bahuguna
    Bharti Airtel acquired Zain's African operations in a $10.7 billion deal in 2010, making it the fifth largest mobile operator globally with over 42 million customers across 15 countries. However, Bharti faced hurdles integrating the acquired markets due to issues in Nigeria, Congo and Gabon. Bharti had also unsuccessfully attempted to acquire MTN in deals valued at $45 billion and $24 billion in 2008 and 2009 respectively, which failed due to disagreements over price and structure.

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    Bharti-Zain Deal Bharti - Zain Deal: By: - Vivek Yadav By: - Vivek Yadav

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    Akshat Bahuguna
    81 views17 pages
    Bharti Airtel acquired Zain's African operations in a $10.7 billion deal in 2010, making it the fifth largest mobile operator globally with over 42 million customers across 15 countries. However, Bharti faced hurdles integrating the acquired markets due to issues in Nigeria, Congo and Gabon. Bharti had also unsuccessfully attempted to acquire MTN in deals valued at $45 billion and $24 billion in 2008 and 2009 respectively, which failed due to disagreements over price and structure.

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    BHARTI- ZAIN DEAL

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    Bharti Airtel acquired Zain's African operations in a $10.7 billion deal in 2010, making it the fifth largest mobile operator globally with over 42 million customers across 15 countries. However, Bharti faced hurdles integrating the acquired markets due to issues in Nigeria, Congo and Gabon. Bharti had also unsuccessfully attempted to acquire MTN in deals valued at $45 billion and $24 billion in 2008 and 2009 respectively, which failed due to disagreements over price and structure.

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    81 views17 pages

    Bharti-Zain Deal Bharti - Zain Deal: By: - Vivek Yadav By: - Vivek Yadav

    Uploaded by

    Akshat Bahuguna
    Bharti Airtel acquired Zain's African operations in a $10.7 billion deal in 2010, making it the fifth largest mobile operator globally with over 42 million customers across 15 countries. However, Bharti faced hurdles integrating the acquired markets due to issues in Nigeria, Congo and Gabon. Bharti had also unsuccessfully attempted to acquire MTN in deals valued at $45 billion and $24 billion in 2008 and 2009 respectively, which failed due to disagreements over price and structure.

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    of 17

    BHARTI- ZAIN DEAL

    By:- VIVEK YADAV


    Recent M &A
    • Dhanlakshmi bank to buy 15% stake in
    destimoney securities
    • KGS Nelson acquired 60% in Cochin Kagaz
    • Bombay Rayon to acquire 70% in STI India
    • Venkey’s to buy Blackburn Rovers
    • TGB acquires US based Active
    • TATA chemical is acquiring Grown Energy ltd.
    CONTD…
    • Yatra acquires stake in TSI
    • Keventer agro acquire 50% in Candico
    • Chrys Capital sells 3.4 % stake of M&M
    • Chrys Capital Acquired 29% in Pratibha ind. ltd
    • Stan Chart PE to raise 49% stake in Checkmate
    BHARTI
    • India’s largest telecom company
    • Over 141 million customers
    • Headquarters :- New Delhi
    • Chairman & MD:- Sunil Mittal
    • CEO:- Sanjay Kapoor
    • Over 25000 employees
    • Revenue- $ 7.254 bn
    • Net Income - $ 1.662 bn
    ZAIN
    • Kuwait based company
    • 5000+ employees
    • Presence in 8 nations
    • Headquarter:- kuwait city
    • CEO:- Nabeel bin Salamah
    • Revenue:- $ 8.056 bn
    • Net Income:- $ 675 mn
    DEAL
    • Bilateral deal
    • India’s second largest deal overseas
    • Worth $10.7 bn
    • $ 8.3 bn paid at the time of deal
    • $ 700 mn to be paid next year
    • $ 1.7 bn debt
    STRUCTURE OF DEAL
    BHARTI AIRTEL

    SINGAPORE SPV

    NETERLANDS SPV

    ZAIN AFRICAN
    OPERATION
    15 COUNTIES
    OPERATION
    Advantages to Bharti
    • Airtel become global brand
    • Became 5th largest cellular operator
    • Gained 42 mn customers
    FACTORS FOR THE DEAL
    • Saturated Indian market
    • New African market
    • Low cost of operations
    • Multi Geographic presence
    • Long terms profit
    HURDELS AGAINST BHARTI AIRTEL
    • Overpriced deal
    • Deal may affect bharti’s profit
    • Nigeria, Congo controversy
    • Gabon glitch
    FUNDING
    • Taken loan from Barclays Bank, Standard
    Chartered Bank
    • Loan of $ 7.5 on 174 bps above libor
    • Advisory fees $ 21 mn
    PROPOSED AIRTEL MTN DEAL
    MTN
    • Largest player of South Africa
    • 103 mn customer base
    • Head quarter:- Jo’burg
    • CEO:- Phuthuma Nhelko
    • Spread across 21 nations of Africa & middle
    east
    • Revenue $ 15.9 bn
    FAILURE
    • Proposed deal of $ 24 bn
    • Failed 2 times
    • In 2008
    • & in 2009
    INITIAL STAGE
    • Bharti agree to pay $ 45 bn
    • Would be largest deal 3 times bigger than
    TATA
    • Want to give it in 70:30 ratio (share, cash)
    • MTN want it 50:50
    • Agree to give R 175/ share
    • MTN wanted R 180/ share
    LATER
    • Bharti agrees to take 49% stake for $24 bn
    • Dual listing
    • MTN wants its share to convert into GDRs
    • Indian govt. didn't allow deal
    • Govt. doesn’t want to change laws

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