Will Bharti Airtel get lucky in Africa this time?
Bharti Airtel, the first Indian telecom company to cross 100 million subscribers is looking to enter Africa. It’s African ambitions are not new. It has already tried to enter the African market with the failed merger with South Africa’s MTN. That deal, which was supposed to be the biggest merger ever in India, went sour because of regulatory requirements and South African government not liking the terms and conditions of the deal. That was less than six months ago.
Bharti has Kuwait based Zain telecom as its new target. Both Bharti and Zain have reached an agreement. Bharti will acquire Zain’s African telecom assets except Sudan and Morocco. Zain telecom has presence in 23 nations (Middle east and Africa) with a subscriber base of 70 million. Zain’s African operations alone span 17 nations with a subscriber base of 42 million. The enterprise value of Zain Telecom is $10.7 billion.
Bharti Airtel has a subscriber base of 112.5 million in India alone. Bharti operates in Sri Lanka and Jersey Island. Bharti entered Bangladesh with its Warid Telecom acquisition.
It is easy to guess why Bharti wants to enter African market. Indian market is nearly saturated and is facing hyper-competition. Growing in this market with the same set of players is extremely difficult. Africa is the best market to be in right now.
If the deal goes through Bharti will have over 150 million subscriber base which would place it among top telecom companies in the world. The question is, will Bharti get lucky in Africa this time?
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