[business week] Singapore Telecommunications Ltd. should explain to shareholders why the company allowed associate Bharti Airtel Ltd. to bid for Zain’s African wireless assets, instead of offering to buy the businesses directly, analysts at Deutsche Bank AG said.
“This is one of the few African portfolios potentially available, and it is not clear how STel’s shareholders benefit from indirect exposure to Africa,” the Deutsche Bank analysts including Hong Kong-based William Bratton wrote in a report yesterday. “We are increasingly puzzled by STel’s international strategy.”
Bharti Airtel, in which Singapore Telecommunications, also known as SingTel, owns almost a one-third stake, this week offered $9 billion to buy most of Kuwait-based Zain’s African assets. The Singapore company was supporting the deal, the Times of India reported today, citing Bharti Chairman Sunil Mittal.
SingTel gained 1 percent to S$3.03 as of 10:19 a.m. in Singapore, while the Straits Times Index slipped 0.5 percent.
Bharti, South Asia’s biggest mobile-phone company, contributed fourth-quarter profit of S$235 million ($166.7 million) to Singapore Telecommunications, the shareholder said in its earnings report this month. The New Delhi-based carrier last month said it had 120.2 million subscribers as of Dec. 31, an increase of 40 percent from a year earlier.
Deutsche Bank ‘Puzzled’ by SingTel’s Strategy After Bharti Bid