By IANS,
Mumbai : The shares of India’s top telecom company Bharti Airtel opened strong on bourses here Wednesday, a day after it sealed a $10.7 billion deal to acquire the African assets of Kuwait’s Zain.
The bluechip, among the 30 scrips that are part of the sensitive index (Sensex) of the Bombay Stock Exchange, opened at Rs.312.10 and soon moved up to Rs.316.50, against the previous close at Rs.310.95.
Some 10 minutes into trading, the scrip was up 1.33 percent at Rs.315.10.
The legally binding definitive agreement between the two groups was signed at Amsterdam late Tuesday, as the Dutch capital is the corporate headquarters for Zain’s African business.
The addition of the African business will make Bharti the fifth largest mobile phone service company in the world with 179 million subscribers, up two places. The deal covers 15 African countries in which Zain has a presence, excluding Morocco and Sudan.
“This agreement is a landmark for the global telecom industry and a game changer for Bharti,” chairman Sunil Mittal said in a statement. “More importantly, this transaction is a pioneering step towards South-South cooperation and strengthening of ties between India and Africa.”
Bharti Airtel is among Asia’s leading telecom service providers with operations in India, Sri Lanka and Bangladesh. As on Jan 31, it had the largest market share of 23.33 percent in India’s mobile telephony segment with 121.71 million subscribers.
The Indian group had late last year failed to strike a deal for the second time with South Africa’s MTN.
The MTN deal, potentially worth $24 billion in cash and equity, envisaged Bharti getting a 49-percent stake in MTN, and the South African firm and its shareholders 36 percent equity in the Indian telecom major. But it got stuck over policy issues.
Now, MTN will be a major competitor in the territories the Indian company is entering.