Posts Tagged ‘MTN’

Fiscal deficit at $65.7 billon for Apr-Nov: Govt

The fiscal deficit of India for the period between April to November stood at Rs 3.06 trillion ($65.7 billion), or 76.4 percent of the full-year target, the government said in a statement on Thursday. The tax receipts stood at Rs 2.33 trillion and a total expenditure stood at Rs 6.22 trillion for the first eight months of the financial year 2009/10.

In July, the government had forecasted fiscal deficit of Rs 4 trillion, or 6.8 percent of gross domestic product (GDP), for 2009/10.

The finance minister Pranab Mukherjee earlier this month had said that the fiscal deficit would not cross the target of 6.8 per cent of the gross domestic product (GDP). With the prevailing trends in the receipts and expenditure, along with better than expected economy performance in the second quarter of the current fiscal, it is expected that the fiscal deficit will remain with the estimate of 6.8 per cent.

However, the direct tax collections by the government increased by a marginal 3.7% to Rs 1.83 lakh in the first 8 months of this fiscal. Further, in the personal income tax segment, the government collected Rs 70,262 crore, up 4.53% while in November, the tax collections were nearly similar to last year as the mop-up was Rs 10,375 crore.

Moreover, the corporate tax collections declined by about 30% to Rs 3,214 crore against Rs 4,561 crore last fiscal while in the April-November period, the collections by way of the Security Transaction Tax stood at Rs 4,349 crore, up 4.44%.

The Finance Minister, Mr. Pranab Mukherjee, yesterday stated that the Indian economy cannot sustain a high fiscal deficit for very long and it is, however, still too early to pull out of the fiscal stimulus.

“We shall have to strike a balance between the requirement of the economy and also the capacity of the economy to bear this level of fiscal deficit and borrowing,” the Finance Minister said on the sidelines of a Corporation Bank event.

Bharti Airtel Shares Shot Up, Ended 4% Higher :)

Bharti Scrip ended 4 percent higher, a day after the firm had to terminate the proposed $24-billion equity-swap-cum strategic tie-up with South Africa’s telecom major MTN.

Bharti Scrip ended 4 percent higher, a day after the firm had to terminate the proposed $24-billion equity-swap-cum strategic tie-up with South Africa’s telecom major MTN.

Bharti Airtel shares, which opened on a firm note Thursday, ended 4 percent higher than its previous close, a day after the firm had to terminate the proposed $24-billion equity-swap-cum strategic tie-up with South Africa’s telecom major MTN.

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The deal, if it had materialized, would have created the world’s third largest mobile phone firm, but had led to analysts worrying that the consequent debt burden would have made its stock unattractive.

Upon collapse of the talks, the company’s shares opened at Rs. 435 Thursday on the Bombay Stock Exchange (BSE) as against the previous day’s close at Rs. 418.55.

It shut shop at Rs. 435.35, a gain of Rs.16.80 or 4.01 percent over the previous day’s close.

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The scrip had shot up to an intra-day high of Rs.467, moving up Rs.27.30 or 6.52 percent.

It had hit a 52-week high of Rs.990 on May 19 and an annual low of Rs.360.10 on Aug 11.

The company has been a laggard on the stock exchanges over the past month, falling 3.74 percent on the BSE even as the benchmark index of the bourse, the Sensex, rose 7.56 percent during the same period.

Analysts had been viewing the stock negatively owing to Bharti’s persistent sweetening of its offer for MTN.

In the last quarter, the scrip fell 4.36 percent, while the Sensex rose 18.17 percent.

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However, with the deal off, the scrip is back in favour with traders and is expected to take off.

‘In a way this is good news for the Bharti scrip; had this deal happened it would have burdened the company’s balance sheet which is currently low on leverage,’ said SMC Capitals equity head Jagannadham Thunuguntla.

‘Analysts have been wary of the deal because of past acquisitions like the Tata Corus deal, which turned Tata’s balance sheet into a heavily leveraged one,’ added Thunuguntla.

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Late Wednesday, Bharti Airtel and South Africa’s MTN said they were terminating their talks for the proposed deal that could have created a large mobile phone entity, just behind China Mobile and Vodafone Group, with a subscription base of 207 million.

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According to Bharti, the proposed deal was called off after the South African authorities declined to accept certain regulatory constraints on the part of both sides.

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Bharti-MTN Deal May Hit Turbulent Weather with New Takeover Norms in Place!!

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The $23-billion equity swap deal proposed by Bharti Airtel and South Africa’s MTN may hit turbulent weather with India’s capital markets watchdog amending the merger and takeover norms involving international transactions, experts said Tuesday.

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In a move that surprised the corporate sector, the Securities and Exchange Board of India (SEBI) Tuesday said the mandatory open offer norm will be triggered even if the overseas equity holdings, in the form of global depository receipts or American depository shares, exceed 15 percent of the total paid-up capital of the target company.

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Earlier, the open offer was mandatory only when the acquisition of shares in the target company exceeded 15 percent during transactions entered into within the country, either through stock market operations or through preferential deals.

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In the Bharti-MTN deal, the two sides proposed to exchange shares in addition to payout of cash that exceeds 15 percent.

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Bharti had proposed to buy 36 percent of the South African company by offering shareholders half a Bharti share, whereas MTN was to get a 25 percent stake in the Indian telecom major for $2.9 billion by issuing global depository receipts.

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“In its existing form, the Bharti-MTN deal will become more complicated because of this amendment. The dynamics have changed and both MTN and Bharti will have to go back to the drawing board to see the deal through,” said SMC Capitals equity head Jagannadham Thunuguntla.

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As per the existing provisions of the SEBI takeover code, no acquirer can buy shares of 15 percent or more in a listed company without making an open offer to acquire a minimum of 20 percent of such listed company’s shares from the public shareholders.

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Announcing the changes in the takeover code, SEBI chairman C.B. Bhave also said that there would be no retrospective effect on earlier deals because of this amendment.

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