Bharti Airtel denies talks with Orange on Africa ops

NEW DELHI: The country’s largest telecom operator, Bharti Airtel has denied news reports of a possible merger of its African assets with France’s largest phone company Orange.

According to media reports, Orange SA is scouting for assets in the African continent and is interested in Bharti Airtel’s operations, as it attempts to increase its business in the region.

A Bharti spokesperson said, “We strongly deny these rumors which are completely baseless.”

Bharti is present in 17 countries throughout Africa. It had bought Zain Telecom’s African operations in 2010.

However, the world’s fourth largest telecom operator by subscribers had continued to pile losses in it African operations and this week it reported a net loss of $136 million for the third quarter of the fiscal.

The company’s Africa revenue dropped by 5.3 per cent in the quarter ended December 2014 over last year to $1.16 billion, with the growth limited by currency fluctuations. However, sources said that the company was not in negotiations to sell or merge its African assets with Orange.

“A year back there were some discussion with Orange for a possible merger but it collapsed,” a person familiar with the matter told ET, explaining that both the companies had wanted to retain a controlling stake over the merged entity.

“And then that was it. Bharti decided to go solo and divested its tower business,” the person added.

Another person said that Bharti had just finished divesting its tower business and it didn’t make sense for it to now go for a merger.

“Secondly, Orange will be more interested in the Francophone operations of Bharti, and not the East African ones,” the second person added explaining why the two companies weren’t a perfect fit for each other.

Bharti has been performing well in the Francophone countries and divesting its East African operations would make more sense.

Last year, Bharti sold close to 11,500 of its 15, 000 to Helios, Eaton and American Tower Company in a bid to cut costs, deleverage its balance sheet and focus on core operations in the African continent.