Airtel postpones its plan of 9Mobile acquisition.
As a part of its consolidation strategy, Airtel had decided to acquire 9Mobile last year but the telecom giant did not submit its financial bid required for the acquisition; the last date for bid submission was January 16, 2018.
Last year Bharti Airtel was planning to buy 9Mobile, which is its arch rival at South Africa. But now the Indian telecom sees this to be a loss as 9Mobile is already under immense debt.
Barclays Africa is in the job of looking into the deals which are being received for 9Mobile acquisition. The complete sale will take some time as Barclays need to restructure the debt of the company. The reason which Bharti Airtel has put forward for not participating in the bid is that it sees little worth in the deal. But as per another source Bharti Airtel lacks enough information about the company which is required to make the bid and hence step backed. Globacom, another private Nigerian telecom company has submitted a financial bid to acquire 9Mobile.
Last year in first quarter Airtel has suffered a dip in 30.8% of profits at Africa. Owner of Airtel, Sunil Bharti Mittal blamed the negative foreign exchange impact at Nigeria for this loss.
9Mobile was previously known as Etisalat Nigeria. The company had taken a hefty loan of $9.2 billion from the local banks in 2013 but could not repay the lenders last year. For this year the lending banks stepped in and Central Bank of Nigeria had to intervene and arrange for the financial bid; it also changed the name and management board members of the company.
9Mobile was the fourth largest telecom of the country and had lost numerous customers after the debt problems came into news. At present MTN is the telecom leader in South Africa with a 36.1% share.