Bharti and MTN have been courting each other for some time now and this on again, off again relationship is close to getting cemented. But one of the pair, Bharti, has decided to give itself a deadline to consummate the deal.
As Bharti-MTN deal nears another deadline on August 31, Bharti's top management is getting anxious to close the deal.
Sunil Mittal and his team don't want to extend the deadline anymore and have made up their mind to either close the deal within this time frame or walk away.
Bharti top management wants to close the MTN deal as soon as possible after being in talks for almost 4 months and missing one deadline of July 31.
The company has now set an internal deadline for itself and its top management wants to arrive at some sort of agreement by early September. Bharti is not keen to extend the exclusivity deadline beyond August 31 and is unlikely to up its offer by too much. Also, it may ultimately agree to a minor increase in the cash payout.
Suresh A Mahadevan, head of research at UBS Sec, said, “The deal is a positive for Bharti. They will not pay anything which is not sensible, expect only minor tinkering with what they offered.”
Bharti and MTN are still busy in the final negotiations of the merger and both companies have already started raising finances to fund the merger.
Bharti will pay upwards of $4.5 billion in cash, in addition to shares to get 49 per cent stake in MTN in a complex share plus cash deal.
But that’s not all. According to Bharti sources, even if a final agreement isn't signed by August end, both the companies will sign an indicative agreement, which will not only commit both the companies to the deal, but also spell out its final structure.
Bharti officials, however, were not willing to share any details.
Manoj Kohli, CEO of Bharti Airtel, said, “I can only say that the talks with MTN are on and progressing well.”
Meanwhile, there is a feeling within Bharti that with the top management having spent so much time and effort there is a need to close the deal quickly.
That is something, which the company’s top brass has conveyed to MTN as well.
However, both the companies are still facing a challenge in bringing all the big investors in MTN, including government owned players on board without which it will be difficult for Bharti to close the deal.
As Bharti-MTN deal nears another deadline on August 31, Bharti's top management is getting anxious to close the deal.
Sunil Mittal and his team don't want to extend the deadline anymore and have made up their mind to either close the deal within this time frame or walk away.
Bharti top management wants to close the MTN deal as soon as possible after being in talks for almost 4 months and missing one deadline of July 31.
The company has now set an internal deadline for itself and its top management wants to arrive at some sort of agreement by early September. Bharti is not keen to extend the exclusivity deadline beyond August 31 and is unlikely to up its offer by too much. Also, it may ultimately agree to a minor increase in the cash payout.
Suresh A Mahadevan, head of research at UBS Sec, said, “The deal is a positive for Bharti. They will not pay anything which is not sensible, expect only minor tinkering with what they offered.”
Bharti and MTN are still busy in the final negotiations of the merger and both companies have already started raising finances to fund the merger.
Bharti will pay upwards of $4.5 billion in cash, in addition to shares to get 49 per cent stake in MTN in a complex share plus cash deal.
But that’s not all. According to Bharti sources, even if a final agreement isn't signed by August end, both the companies will sign an indicative agreement, which will not only commit both the companies to the deal, but also spell out its final structure.
Bharti officials, however, were not willing to share any details.
Manoj Kohli, CEO of Bharti Airtel, said, “I can only say that the talks with MTN are on and progressing well.”
Meanwhile, there is a feeling within Bharti that with the top management having spent so much time and effort there is a need to close the deal quickly.
That is something, which the company’s top brass has conveyed to MTN as well.
However, both the companies are still facing a challenge in bringing all the big investors in MTN, including government owned players on board without which it will be difficult for Bharti to close the deal.
S:NP
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