Tags:MTN | China Mobile

Indian telecom giant Bharti Airtel may face competition from companies from two other fast- growing emerging economies China and Russia in its bid to acquire Africa''s largest mobile phone operator MTN, the New York Times reported quoting analysts and investment bankers.

"A battle for the MTN Group, a leading South African telecommunications company, could come down to a clash between the world''s largest and fastest-growing emerging markets," the report said, adding that Bharti is expected to face stiff competition from a Chinese rival.

The report further added that analysts and experts also do not rule out possible interest from Russia, though no bidders have yet emerged.

The report termed Johannesberg-based MTN as "highly prized" by virtue of its 70 million subscribers and presence in some of the world''s fastest-growing telecom markets such as Nigeria and Iran.

"China and India have often been compared as the rest of the world adjusts to the presence of new economic powers, but rarely have representatives of the two nations competed head to head on a deal.

"Chinas government-controlled entities have invested and lent billions of dollars to African countries in recent years, while private companies in India have concentrated more on shopping outside the nations borders," it noted.

According to the report, Indian firms have executed larger number of "big deals," but in terms of value, Chinese companies have an upper hand. The report said that analysts expect MTN to attract Chinese firms like China Mobile or China Telecom, given the strong financial positions of the Chinese firms.

"So far, a Chinese-Indian showdown is purely in the minds of bankers and analysts. Representatives from the Beijing and Hong Kong offices of China Mobile said they had not heard anything yet relating to a possible bid for MTN. William Li, the Hong Kong spokesman for China Telecom, said he had also not heard of any plans for a bid," the report added.

About the possible Russian interest in the deal, the report quoted Moscow-based brokerage firm Metropol''s head of research and telecommunications analyst Philip Townsend as saying that Russia''s three top cellphone companies VimpelCom, Mobile TeleSystems and Megaphone were generating excess cash that they cannot invest in their saturated domestic market.

In addition to expanding into other former Soviet republics, they are pushing into countries with cold war-era ties to Russia, which would include some in Africa, it said.

There are many markets in Africa which are natural markets for Russia... They''ve got to find a home for their money," Townsend told the New York Times.



Source:economictimes