Bharti Airtel interested in acquiring 9mobile: Goldman
Bharti Airtel Limited is interested in acquiring Nigeria’s 9mobile, according to Goldman Sachs.
If the Sunil Mittal-led telecom firm buys 9mobile, it will become the number one operator in Nigeria, Goldman Sachs added in the report based on an analyst meet arranged by the company.
Bharti Airtel, Helios Investment Partners, Smile Telecoms, Globacom and Teleology Holdings are the shortlisted bidders for the takeover of Nigeria 9mobile, formerly known as Etisalat.
Bharti Airtel management told analysts that its margins in Africa could improve as the company gains more revenue market share. The firm’s margins from the African business has been improving over the past few quarters and currently stands at around 32 percent.
Goldman Sachs expects Bharti Africa’s earnings before interest, tax, depreciation and amortisation margins to be 34 per cent in financial year 2020-21.
Bharti Airtel is also looking to the fix some of its problem markets. Currently, the company ranks number one or two in 11 out of their 14 African markets, while it lags in Kenya, Tanzania and Rwanda. The company will invest at a slower pace in the laggard markets, and may even sell off its Kenya business, Goldman Sachs added.
In Kenya, Bharti will soon launch 4G to improve their positioning, but mentioned that they potentially have suitors for their Kenya business.
Bharti Airtel expects annual Africa capital expenditure to stay in the range of $600-700 million, with increase in spectrum deployment potentially helping the company take care of additional capacity needs.
Bharti Airtel got nearly 65 per cent of its net profit from the African market in the July-September quarter.
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