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Business – Bharti leaves MTN saga behind, takes new calls

Durba Ghosh

LAGOS (NIGERIA): Twice bitten, Bharti Airtel will shy away from making any more moves at acquiring South African telecom giant MTN, although it will
continue to look at other take over targets, especially state-run telecom firms in emerging markets.

“The MTN chapter is now closed,” said Rajan Mittal, vice-chairman & MD of Bharti Enterprises, adding that Bharti Airtel’s recent acquisition of Warid Telecom in Bangladesh demonstrated the company’s intention to tap business opportunities in emerging markets.

“This is a continent (Asia) that attracts us,” Mr Mittal said. Bharti Enterprises is the parent company of Bharti Airtel, India’s largest private telecom operator by subscribers as well as revenues.

Mr Mittal was speaking to journalists on the sidelines of Indo-West Africa business forum organised by the Indian government and industry body Ficci.

Refusing to divulge if Bharti was currently in talks with any telcos, Mr Mittal clarified that Bharti would bid only for companies offering mobile telephony, and not fixed-line services.

For Bharti, whose international operations include Sri Lanka, Seychelles and Jersey islands in Europe, expanding abroad is vital since urban India is close to reaching a saturation point. Teledensity in cities, towns and metros has crossed 100% and revenues and profits of all Indian telcos are under severe pressure as they engage in a savage price war.

With close to 120 million customers, Bharti remains a clear leader in the Indian mobile industry, but its pace of customer additions is slowing and its market share is under threat from new players launching services at the lowest possible tariffs.

Bharti’s revenues grew at the slowest pace in six years in the quarter ended September 2009 and sales and profits are forecast to fall further in the December quarter.

Around 13 mobile firms are jostling for business in a market, which telecom analysts say, can support only 4-5 operators. Three more companies are due to launch services soon, portending fiercer battles to win and keep customers.
Following the failure of the MTN deal, Bharti has been linked to several operators, including Kuwait’s Zain and Egypt’s Orascom, as both these operators have significant presence in markets across Africa and Asia.

Last week, Bharti Airtel had announced the elevation of Sanjay Kapoor as its CEO for India and South Asia, placing him to lead the charge in the increasingly cutthroat domestic mobile market, and moved incumbent Manoj Kohli to a new role spearheading the global expansion of the country’s largest telecom group. From April 1, Mr Kohli will head a newly created international business division.

January 19, 2010 - Posted by | Uncategorized |

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