The duo announced their merger intentions in May, and have been engaged in exclusive talks since then. (See Bharti, MTN in $23 Billion Talks.)
But, for the second time in two years (the carriers had attempted a merger in 2008, too), the deal fell apart at the last minute, with a statement from Bharti noting that the required blessing from the South African government was not forthcoming.
"The alliance planned between Bharti and MTN was a vision based on solid fundamentals, which had the potential of creating an emerging markets telecom giant and the third largest telecom company in the world. Substantial synergies could have been captured with this proposed transaction," stated Bharti.
But the deal "needed an approval from the government of South Africa, which has expressed its inability to accept it in the current form. In view of this, both companies have taken the decision to disengage from discussion."
That's not the end of it, though, as Bharti laid the groundwork for another, third attempt at the merger in 2010. "Bharti has enjoyed its engagement with the MTN management and its Board; and wishes them continued success. We hope the South African government will review its position in the future and allow both companies an opportunity to re-engage."
In the meantime, Bharti says it will continue to "explore international expansion opportunities." With MTN's assets across Africa proving part of its attraction to Bharti, it's just possible the Indian giant, which has 108 million mobile customers in its domestic market, could turn its attention to other African assets. Is it too late to give Zain Group a call? (See AfricaWatch: M&A Frenzy, Zain's $13.7B Mystery Investors, and Tata Takes Summer Subs Lead.)
Maybe Sunil Bharti Mittal, chairman and group CEO of Bharti Enterprises (Bharti Airtel's parent), will shed some light on the carrier's next move at next week's ITU Telecom World 2009 event in Geneva, where he is due to appear on a panel to discuss the impact of information and communication technologies (ICTs) on economic growth.
And who knows? Bharti's local rival, Reliance Communications Ltd. , might also retread its 2008 tracks by trying to engage MTN on the rebound. (See Reliance Feud Kills MTN Deal.)
— Ray Le Maistre, International News Editor, Light Reading