SingTel – BT
Bharti to seek cover from Zain's Nigeria dispute
BHARTI Airtel Ltd, the Indian phone company planning a US$9 billion purchase of Zain's African assets, may ask Zain for legal protection from a dispute in Nigeria, according to a source familiar with the negotiations.
The proposal, to be considered by Bharti's board today, will seek an indemnity from Zain against ongoing litigation involving operations in Nigeria, the source said. Econet Wireless Holdings Ltd, based in a suburb of Johannesburg, is disputing control of Zain's unit in Nigeria.
The Nigerian operations are the single largest revenue producer for Kuwait's Zain, and have been described by Bharti chairman Sunil Mittal 'as the most important piece' of its planned acquisition. Econet chief executive officer Strive Masiyiwa said in an interview on Thursday that there has been no agreement or settlement in the dispute over the Nigerian unit.
Econet has 'not heard from Zain or Bharti' on Nigeria, Mr Masiyiwa said, adding that he's 'cheesed off' about reports that a settlement has been reached.
India's largest wireless company's plan cannot include the purchase of Zain's Celtel Nigeria BV unit, Econet has said. For Bharti, troubles in Nigeria, Africa's most populous nation and its fastest growing telecommunications market, are among hurdles that the company faces as it seeks to take over Zain's operations in 15 African countries.
Kuwait's Mobile Telecommunications Co, or Zain, and Bharti said on Feb 15 that they would hold exclusive talks until March 25 on the assets.
Econet is seeking to overturn a 2006 deal in which Celtel bought a 65 per cent stake in Nigerian mobile operator Vmobile, since renamed Zain Nigeria. Econet, with 5 per cent of Zain Nigeria, said that it should have had the right of first refusal on those shares.
Econet's Mr Masiyiwa has said that the case is still in arbitration and that until that process has been completed, 'Nigeria cannot be sold, it is not for sale, there can be no due diligence by Bharti or any other party.' — Bloomberg