MTN denies that it is in talks with Reliance Communications regarding a potential merger. While Reliance's stock rose on speculation that it may sell a stake or merge with a foreign telecom company, an MTN spokeswoman stated that the rumors were untrue. Reliance is seeking funding to invest in its network and pay down debt, making it an attractive target for companies like Etisalat and MTN. However, MTN reiterated that it is not currently in discussions with Reliance.

1. MTN denies talks with Reliance Comm
Friday June 4, 11:16 AM
By Agencies
South Africa's MTN Group said it was not in talks with India's Reliance
Communications,following a newspaper report on Thursday that Reliance was mulling a merger
with MTN.
Shares in Reliance Comm, India's No. 2 mobile operator, rose for a second straight day on
investors' hopes that it may sell a stake or consider a merger with a foreign telecoms firm that
would provide it with much needed funds. Etisalat of Abu Dhabi and MTN are seen as potential
partners.
Asked whether MTN was in talks with Reliance, MTN spokeswoman Nozipho January-Bardill
said:"That's not true.
"If we were talking to Reliance we would have told the market," she said.
Media reported Reliance Comm, controlled by billionaire Anil Ambani, was considering a
merger with MTN, with which the Indian firm had initiated tie-up talks in 2008 in an ultimately
thwarted deal.
India's 600 million-user cellular market is the world's fastest growing, but ferocious competition
and the need to spend billions of dollars on licences and network gear are squeezing operators,
with consolidation expected.
Reliance Communications said on Wednesday it had received proposals from international
telecoms firms to buy a strategic equity stake, after a newspaper report said Etisalat was eyeing a
25 per cent stake for Rs 180 billion ($3.9 billion), implying a sharp premium.
"Both look fairly reasonable, but the one which is from Abu Dhabi looks a little bit more
advanced," a person with knowledge of the matter said earlier on Thursday, declining to be
identified as the information is sensitive.
However, another person familiar with the situation who also declined to be identified, said that
with regard to Etisalat, it was "early days. No deal imminent."
Etisalat, which already has a startup joint venture in India, also said on Wednesday it was
looking to buy a stake in an Indian operator and was in talks with several firms but declined to be
specific.

2. Emirates Telecommunications Corp, or Etisalat, is being advised by Standard Chartered, sources
said.
Shares in Reliance Comm, India's No. 2 mobile carrier, ended 6.4 per cent higher on Thursday
after gaining 11 per cent on Wednesday, cutting its losses for the year, after being one of the
worst performers in the 30-share main BSE index.
"Nobody knows whether any of the deals would happen or not, but certainly windows of
opportunity are open for Anil Ambani," said Jagannadham Thunuguntla, equity head at SMC
Capitals in New Delhi, referring to Reliance Comm's billionaire chairman.
"If it is actually a stake sale, that's a good move. If the incoming party pays a good premium, it
would help them reduce some debt," Thunuguntla said.
MTN said in April it was in talks with the parent of Egypt's Orascom Telecom about a potential
deal. Those talks have been stymied, however, due to opposition from the Algerian government
over the sale of Orascom's Algerian unit, widely seen as its most attractive asset.
UNSHACKLED
Anil Ambani is free to court strategic investors after last month ending a non-compete agreement
with his long-estranged brother Mukesh. Two years ago, Anil Ambani's bid to merge Reliance
Comm with MTN was scuppered when Mukesh asserted a right of first refusal on the Indian
firm's shares.
Reliance Comm had net debt of about Rs 199 billion ($4.3 billion) at the end of March, while it
paid Rs 85.85 billion for acquiring third-generation spectrum licences in a recent auction that
was for more costly than expected.
The company is also one of the bidders in an ongoing auction of wireless broadband spectrum
licences, in which bids for all-India coverage licences have already hit $1.8 billion.
Building the next generation networks would cost billions of dollars more.
Reliance Comm has regulatory approval for an initial public offer of its telecoms tower unit,
which banking sources have said could raise up to $1 billion, but the company is yet to set a date
for the share sale.