Bharti set to acquire Warid in Bangladesh

Bharti Airtel given clearance to buy 70% stake in Warid's Bangladeshi operation with initial investment of $300 million.

Tags: BangladeshIndiaMergers and acquisitionsUnited Arab Emirates
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Bharti set to acquire Warid in Bangladesh Bharti Airtel is keep to expand abroad amid fierce competition in its home market. (Getty Images)
By  ITP.net Staff Writer Published  January 10, 2010

Bharti Airtel is set to become the first Indian operator to enter Bangladesh, after it received approval from the regulator to acquire a 70% stake in the country's fourth biggest mobile operator, Warid Telecom, from UAE-based Dhabi Group.

While the price of the stake has not been disclosed, the Bangladesh Telecommunication Regulatory Authority said it had approved the transfer of shares between Dhabi Group and Bharti, according to news agency AFP.

"The commission has given the go-ahead to transfer Warid telecom shares to Bharti Airtel. The commission has also approved investment of $300 million by Bharti Airtel for the expansion of their telecommunication network across the country," the director general of BTRC, Ahsan Habib was quoted as saying by AFP.

However, the final deal could be worth some $900 million, according to a report from Bangladesh's Daily Star newspaper last month, which cited officials at Warid. 

The development follows closely from Bharti's failed attempt to acquire South Africa's MTN Group last year and could indicate a shift in focus toward smaller deals that offer the company significant growth potential in fast developing telecom markets.

Bangladesh, which has a population of about 150 million, has a low mobile penetration rate with just 51 million mobile subscribers, although this figure is expected to rise to 70 million by 2011.

The deal is the second disposal for Warid Group in the past three months. Its owner, Dhabi Group, which also owns Warid in Pakistan, signed a deal to sell its operations in Uganda and Congo to India's Essar Group last November.

Warid Telecom launched in Bangladesh in 2007 and is now the fourth largest of the country's six mobile operators in terms of subscriber numbers.

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