Deal between RCOM and MTN Called Off
Monday, 21st July, 2008
Talks called off Talks between Anil Ambani owned Reliance Communications (RCOM) and South African Telecoms giant-MTN were called off on Friday night without reaching any agreement. Talks were aimed at merger of both of the telecom companies that could have created one of the 10 top mobile phone service provider’s powerhouses. Both of the sides in their statements have said that talks were called off because of some legal and regulatory issues.
Agreement Negotiations between both of the telecom companies had started on May 26 and were being held secretly but somehow the news spread out that Mr. Anil Ambani is going to sell his stake in Rcom to MTN following which MTN would have become the majority shareholder in the Rcom. It was also being said that Ambani would also become the chairman of the merged group. After the merger Rcom would have become a telecom company operating in about two dozen countries with its reach to around 120 million subscribers.
Issues MTN had extended the date of the talks to give more time to the Ambani brothers to resolve the dispute but nothing enthusiastic happened. According to PTI, Rcom in a statement said,” The two sides were unable to conclude the transaction due to certain regulatory issues”. Mukesh had on Thursday had started arbitrary proceedings. To avoid the court MTN decided not to go ahead with the tie-up talks. It was once again the eruption of the battle between the Ambanies that abruptly ended the negotiations between RCOM and MTN.

