The extension of the discussions until September 30 – the second since the talks began in late May — came amid media reports that MTN is holding out for Bharti to sweeten its offer.<\/p>\n
The discussions which earlier had been prolonged to August 30, “continue to progress satisfactorily,” Bharti said.<\/p>\n
The proposed merged company would straddle Africa, Asia and the Middle East and have more than 200 million customers, 20 billion dollars in annual revenues and be the world’s third-biggest mobile operator by subscribers.<\/p>\n
The announcement of the extension came as India’s Hindustan Times reported that the original proposed 23-billion-dollar cash-and-share swap announced by the two companies might have to be “completely restructured.”<\/p>\n
The newspaper, quoting an unnamed source connected with the deal, said “some directors of MTN want the whole deal to be restructured so that there is more value in it for the MTN shareholders.” But the source added that the deal was moving “in the right direction.”<\/p>\n
Under the initial proposal, Bharti would be the biggest shareholder in the merged group, taking a 49 percent stake in MTN while MTN shareholders would have an effective 36 percent stake in Bharti.<\/p>\n
The two phone companies re-entered tie-up talks in May, a year after Bharti ended negotiations in a dispute over control. The talks fell part after the South African firm proposed an ownership structure that the Indian company said would have involved “Bharti Airtel becoming a subsidiary of MTN.”<\/p>\n
South Africa’s Public Investment Corp or PIC, MTN Group Ltd.’s biggest single shareholder, has voiced its conditional support for the proposed merger but has said there is scope to improve the price.<\/p>\n
Other MTN shareholders have expressed similar reservations.<\/p>\n