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Bharti Airtel acquires Zain Africa

Publication: LexisNexis

Date: Friday, June 11 2010

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Mobile Telecommunications Company K.S.C. (Zain), a Kuwait-based mobile telecommunications

company, has completed the sale of its 100% stake in Zain Africa BV to Bharti Airtel Limited for an
enterprise value of $10,700 million.

The acquisition covers 15 countries with a total customer base of over 42 million. The countries in which
Bharti Airtel has acquired the operations are Burkina Faso, Chad, Congo Brazzaville, Democratic
Republic of Congo, Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Sierra Leone, Tanzania,
Uganda and Zambia. Zain is a Kuwait-based mobile telecommunications company, while Bharti Airtel is
an India-based integrated telecommunication services provider. Zain Africa is a mobile communication
services company. Standard Chartered Bank, Barclays, SBI Group, ANZ, BNP, Bank of America Merrill
Lynch, Credit Agricole CIB, DBS, HSBC, Bank of Tokyo Mitsubishi UFJ and Sumitomo Mitsui Banking
Corporation are Bharti Airtel's financiers for the deal. Update on May 20, 2010: The Zambia Competition
Commission (ZCC) has approved the acquisition of a 78% shares in Celtel Zambia Plc (trades as Zain
Zambia) by Bharti Airtel. On May 18, 2010, the board of ZCC decided to authorize the proposed
acquisition of 100% shareholding of Zain Africa, which includes a 78.9% shareholding in Celtel Zambia by
Bharti Airtel. Update on March 30, 2010: Zain has signed a definitive agreements for the sale of 100% of
its African unit Zain Africa to Bharti Airtel for an enterprise value of $10,700 million. The transaction
implies an equity value of $9,000 million and consideration will be fully satisfied in cash, of which $8,300
million will be paid upon closing and $700 million will be paid one year from closing. Bharti Airtel will also
assume $1,700 million of consolidated debt obligations. Update on March 24, 2010: Board of Directors of
Zain has approved the proposed takeover offer for Zain Africa from Bharti Airtel. Announcement
(February 15, 2010): Bharti Airtel and Zain have agreed to enter into exclusive discussions for the
acquisition of Zain's African unit Zain Africa for an enterprise value of $10,700 million. This transaction
does not include Zain's operations in Morocco and Sudan. The Board of Directors of Zain has approved
the sale to Bharti. Herbert Smith LLP, Stibbe and AZB Partners are acting as legal advisors, while Morgan
Stanley, Standard Chartered PLC, Barclays Capital, SBI Group, Ernst & Young and Global Investment
House are acting as financial advisors to Bharti Airtel. UBS Investment Bank and BNP Paribas are acting
as financial advisors and Linklaters LLP is acting as legal advisor to Zain. WongPartnership LLP and
Milbank, Tweed, Hadley & McCloy LLP are acting as advisors to Bharti Airtel.

African Mobile Market Defies 2008 Global Downturn

with 25% Growth Says New Research from...
Publication: Business Wire

Date: Thursday, September 17 2009

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LONDON -- New research recently released by Blycroft Publishing (www.blycroft.com) sees 25% growth
across the African mobile market with the activation of 74 million new subscribers. The 'Africa and Middle
East Mobile Network Operators Directory' (http://www.mnodirectory.com/africa_mideast.htm) looks into
this market and examines 214 networks across 193 pages of research.

At the end of March 2008 the African mobile market stood at 296 million subscribers. During 2008 the
market grew by more than 74 million subscribers reaching 370 million mobile subscribers as of Q408,
representing a remarkable 25% increase in the size of the market.

This 25% rate of growth can be attributed to several factors. The first of which is the launch of 11 new
networks within Benin, Botswana, Congo Brazzaville, Ghana, Guinea-Conakry, Kenya, Niger, Nigeria,
Senegal, Sudan and Uganda. These launches include Zain launching in Ghana and Orange launching in
both Niger and Uganda. Out of the total increase these operations accounted for just 2.5 million
subscribers, which may have churned from other networks. 70 million other subscribers must be
attributable to another factor with the most likely factors being economic growth and proliferation of
networks within Africa.

Commenting on the results, John Summers, Editor of 'Africa & Middle East Telecom-Week'
(www.ametw.com), said: "This market has been growing in potential for years. With the world unable to
invest in the usual economic markets the global powerhouses have been looking to the African continent.
Money has been moving into the continent with big businesses moving in and investors realising potential
gains to be had. Mobile payments have also surged into the area due to migrant workers sending money
back to family they have left behind. At the same time African owned concerns have managed to keep a
hand in this growth and directed funds back into communication networks, instead of foreign investors
reaping all the rewards. Deep sea cables have also been laid increasing communication traffic volumes.
Having stood so far behind Western Europe and its Middle East neighbours the African region is now
ready for its turn at economic growth."

As of May there were 163 mobile networks live across Africa spanning both GSM and CDMA
technologies.

Across Africa this directory's research looks at mobile markets in Algeria, Angola, Benin, Botswana,
Burkina Faso, Burundi, Cameroon, Cape Verde, Central African Republic, Chad, Comores, Congo
Brazzaville, Democratic Republic of the Congo, Djibouti, Egypt, Equatorial Guinea, Eritrea, Ethiopia,
Gabon, Gambia, Ghana, Guinea-Bissau, Guinea-Conakry, Ivory Coast, Kenya, Lesotho, Liberia, Libya,
Madagascar, Malawi, Mali, Mauritania, Mauritius, Mayotte, Morocco, Mozambique, Namibia, Niger,
Nigeria, Reunion, Rwanda, Sao Tome and Principe, Senegal, Seychelles, Sierra Leone, Somalia,
Somalia (Puntland), South Africa, Sudan, Swaziland, Tanzania, Togo, Tunisia, Uganda, Zambia and
Zimbabwe. Included in this directory analysts are also presented with the operations of the Middle East.

The 'Africa and Middle East Mobile Networks Directory 2009' is also volume 1 of Blycroft's MNO Directory
2009 (www.mnodirectory.com). The global directory is now in its 3rd edition and has grown in size and
quality each year. Analysts can find contact information for approximately 1,000 senior managers within
Volume 1, as well as mobile subscriber data, market shares, ownership details and network technology
information.

About Blycroft

Blycroft Publishing is a UK based telecommunications publisher with a focus on mobile markets. Blycroft
specialises in research on the Africa and Middle-East region and publishes a weekly research service
entitled Africa and Middle-East Telecom Week. The company has also now published the 3rd edition of
both its MNO Directory and The MVNO Directory. These two directories track nearly every mobile
network around the world whether the operator owns a network, buys minutes of use or simply resells
rebranded SIMs. Blycroft has a focus on the end user and produces reliable research ready for use by its
client base. Further information can be found at www.Blycroft.com or the research teams can be
contacted at editor@blycroft.com.
The transaction represents a good growth opportunity for Bharti Airtel in Africa and will also have the
economies of scale to get more cost-efficient. Zain will use the proceeds to pay back debt and distribute
cash dividends to shareholders. With this acquisition, Bharti group's global footprint would expand to 21
countries along with operations in Seychelles, Jersey and Guernsey making the company's network the
second largest population coverage among telecommunication companies globally covering over 1,800
million.