Thursday, June 10, 2010

Bharti Acquires Zain Group's Mobile Operations

Bharti Airtel has finally taken the step towards becoming a global emerging market telecom player by successfully completing the acquisition of Zain Group's mobile operations in 15 countries across Africa. With the acquisition of enterprise value of US$10.7b, Bharti becomes the 1st Indian player to go truly global with a footprint that spans 1.8 billion people.

Bharti has now transformed into a major Indian MNC with operations spanning across Asia and Africa. It will lead to combined revenues of over US$12.4 B and EBITDA of over US$4.7b. Bharti now ranks among the top 5 largest mobile operators in the world.

Impact on SingTel

While the news is exciting, it should be noted that a few of the acquired assets by Bharti are loss-making and have questionable track records. This still ties in with SingTel's strategy of expanding into rapidly growing mobile markets. Most analysts remain neutral on the price of SingTel even though it is a major shareholder of Bharti.

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