Bharti pulls out of talks with MTN

NEW DELHI : India'slargest private telecom company Bharti Airtel on Saturday pulled out ofnegotiation for acquiring an estimated $45-50 billion MTN, saying theSouth African telecom entity deviated from agreed terms."Anin-principle agreement was reached on May 16 and a term sheet wasinitialled between two lead bankers. MTN has now presented a completelydifferent structure, from what was agreed," Bharti said in a statement.Thenew structure envisaged Bharti Airtel becoming a subsidiary of MTN andexchange of majority shares of Indian company held by Sunil Mittal,promoter of Bharti, family and its foreign partner Singtel, in exchangefor a controlling stake in MTN."Bhartibelieves that this convoluted way of getting an indirect control of thecombined entity would have compromised the minority shareholders ofBharti Airtel and also would not capture the synergies of a combinedentity," the company said.Both (Bhartiand MTN) had initiated talks about three weeks ago and talks werecordial through out this period and conducted in good faith.Bhartialso claimed that over a dozen internationally reputed bankers from theUS and Europe of having pledged funds of over $60 billion for theacquisition.The reference point atwhich MTN shares were to be transacted was agreed and frozen at thepoint of starting the discussion and Bharti would like to confirm thatthere was no further discussion on the share price of MTN, at any point.

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