Bharti Airtel is in exclusive negotiations to acquire the African assets of Zain, a Kuwaiti telecoms group in an all-cash deal which is valued at $10.7bn and would mark one of the biggest cross-border transactions in the Middle East.
The Zain board met on Sunday afternoon to agree the terms of the deal, which would involve Bharti paying $10bn for the assets now and $700m at a later date, people close to the situation said.
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The deal, which excludes Zain’s Sudan and Morocco operations, is subject to due diligence. Bharti has until the end of March to examine Zain’s books, the people said.
The Indian telecoms group’s offer has secured the backing of Zain’s two largest shareholders: the Kharafi family, which holds at least 11.47 per cent through a subsidiary, Al-Khair; and the Kuwait Investment Authority, the country’s sovereign wealth fund which owns 25 per cent.
Bharti’s move comes months after it abandoned a $23bn deal with MTN, South Africa’s biggest mobile telecoms group after failing to secure government approval for the transaction.
If successful, Bharti’s acquisition of Zain’s African assets will create one of the largest emerging markets operators with networks across 24 countries in Africa, the Middle East and India.
Kuwait’s stock market halted trading in Zain shares on Sunday pending a decision on an offer.
Last year, Zain rejected an informal offer from French media and telecoms company Vivendi .
Zain is being advised by UBS. Global Investment House of Kuwait and Standard Chartered are advising Bharti.
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