The countrys largest telecom operator Bharti Airtels $10.7-billion offer for buying the African assets of Kuwaiti telecom firm Zain has been accepted by the latters board on Sunday,according to reports of the Kuwait state news agency. The deal would provide Bharti access to 15 more countries in the region,adding around 40.1 million subscribers to its already 125 million-plus user base. With Bharti having presence in five overseas markets post the deal,it would increase its global presence across 20 regions. The combined revenue of the two entities would be around $12 billion. The development follows Bhartis second attempt to seal a $24-billion deal with South Africas MTN failed late last year. In fact,this is Bhartis second round of talks with Zain. It had first started talks with the company after its first attempt to acquire MTN had failed in the summers of 2008. When contacted a Bharti spokesperson declined to comment. However,in October Akhil Gupta,Bharti Enterprises deputy group CEO had said the telco would look at buying a stake in Zain if there was an opportunity. Bharti is expected to inform the stock exchanges about the deal on Monday when the market opens. Last month,Bharti agreed to buy 70% of Bangladeshs Warid Telecom for an initial investment of $300 million. It recently also set up a new unit to drive its foreign expansionfocused on opportunities in emerging markets where it can replicate its low-price,high-volume model. This unit is to be headed by the current CEO of Bharti Airtel,Manoj Kohli. Overseas acquisition by Bharti at this stage is required,as growth in the domestic market is under pressure due to a fierce tariff war. Its October-December earnings got down to single digit. Africa represents about 62% of Zains 64.7 million customers and 15% of the groups net profit. Zain operates in 24 countries including Saudi Arabia and Nigeria. Bharti Airtel has more than 120 million subscribers in India. So far it has overseas operations in smaller markets like Sri Lanka,Seychelles and Jersey Island. Earlier a consortium of Asian investors have been trying to buy the 46% stake from the Kuwaiti family conglomerate Kharafi Group for 2 dinars per share,or about $13.7 billion,although selling the African operations may end that initiative. In one indication of an imminent deal,Zain last week appointed Nabil bin Salama as the firms chief executive,replacing Saad al-Barrak,who is seen as the driving force behind the growth into 23 countries across Africa and West Asia. Barrak resigned earlier this month amid uncertainty about the fate of the parent companys stake sale. Last May,Zain announced a rare cut of 2,000 jobs of its 15,500 workforce,signaling that the heyday of expansion might be over. fe
