'Zain's move to sell African biz a strategic plan'

Telecom entity Zain's move to sell its African assets to Indian major Bharti Airtel is a strategic decision and the deal has a fair price, according to a top shareholder of the Kuwait-based company.

In an interview to British daily the Financial Times, Nasser Al Kharafi, head of the Kharafi group, has said the move to sell Zain's African assets was a strategic decision.

"We sold (it) because we wanted to concentrate on the Middle East and Bharti wanted to get into Africa. It's a fair price and opportunity for both of us," Kharafi said.

The Kharafi group owns a significant stake in Zain. Zain and Bharti Airtel are in exclusive discussions till March 25 for a proposed $10.7-billion deal, where the Indian firm would acquire the African assets of Kuwait-based company, except the operations in Morocco and Sudan.

Attributing to bankers' estimate, the British daily said the Kuwait Investment Authority is Zain's largest, although passive, shareholder, while the Kharafis both directly and indirectly own a stake of almost 20 per cent.

As part of the proposed deal, Bharti Airtel would pay about $9 billion to acquire the African assets of Zain.

Out of the $9-billion payout, Bharti would be paying $8.3 billion immediately after the deal and the remaining $700 million after one year.