Rambler's Top100
 
Все новости World News

Bharti allows $2.5bn for Africa expansion

13 августа 2010

Within Bharti Airtel, India’s largest mobile phone company, top executives widely believe that its $10.7bn acquisition in June of most of the African assets of Kuwait’s Zain was helped by Italian handcrafted leather shoes.

Sunil Bharti Mittal, Bharti’s chairman, and Nasser al Kharafi, one of Zain’s main shareholders, coincidentally wore the same limited edition Moreschi footwear for the first round of talks in Kuwait. The two were persuaded to repeat what was interpreted as a good omen to close the deal in Amsterdam later on.

The “magic of the shoes”, recorded in Bharti's in-house magazine, saved a few hundred million dollars in the final price.

Manoj Kohli, head of Bharti’s international operations, is hoping this auspicious beginning will continue to buoy his company’s fortunes as it expands its low-cost footprint beyond south Asia to become the world’s fifth-largest mobile operator.

Mr Kohli, Bharti’s former chief executive, has just completed a tour of the newly acquired assets spread across 16 African countries, including Nigeria, Ghana and Uganda. In the months ahead, the Delhi and US educated Mr Kohli will spend the lion’s share of his time in Africa. So far, Mr Kohli says he has had no unfavourable surprises from the new assets, its 6,500 employees or from Africa’s notoriously capricious, often weak regulators. The company’s message of sharing networks, bringing new services such as 3G and using strategies tested in India to bring down the costs of mobile telephony have been well received.

Bharti’s efforts to boost some of Zain’s big, but struggling, networks require financial muscle. The company will make an “opening investment” of $2.5bn in its African operations over the next three years, Mr Kohli tells the Financial Times in an interview. The debt it raised to make the acquisition has the company already paying $200m in interest every year. Bharti is not short on ambition. It wants to make its “Airtel” brand, which is largely unknown in Africa, “the most loved brand” in the continent within five years. Bharti also wants to challenge leading rivals for supremacy in mobile markets in Kenya, Nigeria, Uganda and Madagascar.

Short-term goals are to increase Bharti’s African subscriber base to 100m within two years from 42m today and annual revenue to $5bn from $3.6bn now. Earnings before interest, taxation, depreciation and amortisation are expected to grow to $2bn from $1.2bn in the same period.

Although Bharti is sending only 40 Indian managers across to Africa, the new assets are likely to draw a lot of management focus in the months ahead. This week the group added Telecom Seychelles to its portfolio for $62m. But larger international acquisitions are off the cards for now.

“For the next five years we will look to focus on Africa,” said Mr Kohli.

The company also hopes for better times in its fast-growing domestic Indian market, where fierce competition has driven down prices and a government auction extracted $3bn from Bharti for 3G mobile spectrum this summer.

The company suffered a 32 per cent fall in net profit in the quarter to June to Rs16.8bn ($360m) from Rs24.75bn a year earlier.

Mr Kohli predicts the rapid expansion of India’s mobile market to continue unchecked. He foresees a total of 1bn mobile subscribers across the country within four years from the current level of 635m. But while he detects stability returning to a “ferocious market”, he views consolidation among telecoms rivals vital to sustaining adequate profits.

In the meantime, Bharti is focusing on its product mix to keep pace with consumer tastes evolving at lightning pace. In this regard, India and Africa have a shared future based on product diversification to deepen the use of tens of millions of subscribers.

Bharti Airtel is moving beyond voice services to data, internet, media, e-commerce and other lifestyle products. “It’s so different,” says Mr Kohli. “Fifty per cent of our portfolio is different to what it was three years back.”

Источник: Financial Times

Поделиться:
Заметили неточность или опечатку в тексте? Выделите её мышкой и нажмите: Ctrl + Enter. Спасибо!

Оставить свой комментарий:

Для комментирования необходимо авторизоваться!

Комментарии по материалу

Данный материал еще не комментировался.