Zain Africa Speculation Watch: Episode 5 - the Indian Connection

Here's an exciting new bump in the roller coaster rumour ride that is Zain Africa Speculation Watch the mini-series: today's Economic Times chucks Indian cellcos Bharti Airtel and Reliance Communications into the mix, citing a scoop from South African publication Business Day.

Of these two companies, my feeling is that it would be a major surprise if the former really is in contention when it comes to acquiring Zain's African business - not least because my understanding is that Bharti Airtel's mooted (and much discussed) link up with pan-African mobile group MTN exludes the possibility of either company approaching alternative partners/acquistion targets for some time yet.

What about Reliance Communications, then? The cellco, which operates both a CDMA network and a newer GSM network in India, is part of the Reliance-Anil Dhirubhai Ambani Group, which includes companies in the energy and financial services sectors. I'm not aware of this operator having previously made attempts to look beyond India for growth opportunities, but I've written here before about how intense competitive pressures at home might drive Indian MNOs to consider foreign adventures more seriously than in the past. Bharti Airtel aside, however, I'd only heard about the possibility of state-owned BSNL considering (and then dropping out of) plans to bid for a telecoms licence in Tunisia. If Reliance Communications were to expand its business into emerging markets/developing countries beyond the subcontinent, I would certainly understand the logic of it. Whether such a move would be on the scale of bidding for Zain's African operations, however, is something about which I could only make a guess.

Zain Africa Speculation Watch: Episode 5 - the Indian Connection