For Bharti, Africa Potential Outweighs Hurdles
BY ROBB M. STEWART IN JOHANNESBURG AND WILL CONNORS IN LAGOS, NIGERIA
In Africa, Bharti Airtel Ltd. appears determined to wade into a market loaded with poverty, promise and major legal tussles—just like home in India.
Bharti, headed by Indian billionaire Sunil Bharti Mittal, has seized on a potential $9 billion deal with Kuwait’s Zain, or Mobile Telecommunications Co., that, if completed, would catapult the company into the ranks of major telecom operators in Africa. Combined with operations in India, Bharti would have significant footholds in two continental markets. The deal would include the assumption of $1.7 billion in debt.
Bharti isn’t the only telecom operator eager for a piece of Africa. On Tuesday, a consortium involving China Unicom (Hong Kong) Ltd. bid $2.5 billion for the former state telecoms monopoly in Nigeria, according to the National Council on Privatization. The government body said that the China Unicom-led consortium outbid four other contenders by more than $1.5 billion for Nigerian Telecommunications Ltd., or NITEL.
While Bharti is an adept operator in India, with 120 million subscribers, it confronts hurdles in Africa, from vicious price wars to bitter legal battles.
Acquiring the Zain operations, which cover 15 countries, would give Bharti a head start over rival trying to buy scattered operations or acquire licenses in different African countries. Bharti’s bid also comes at a time when new undersea cables are reaching Africa.