The media house notes that MTN has been discouraged by a current revision in India of its telecommunications mergers and acquisitions rules.
Last week, the Indian commissions approved the proposal to raise the cap on foreign direct investment (FDI) in the telecom sector to 100% from a current high of 74%.
International operators had been limited to a 49% holding – rising to a maximum 74% with special regulatory approval from the Foreign Investment Promotion Board (FIPB).
According to Bloomberg, discussions between the two parties centered around MTN taking about a 24% in Reliance Communications, with a market value of about $1.2 billion.
Reliance Communications, which is owned by billionaire Anil Ambani, boasts a customer base of over 130 million, including 7.2 million 3G customers and 29.4 million data customers.
“An acquisition of this nature could potentially limit MTN’s growth in other markets,” Turner-Smith said by phone. “Everyone is relatively pleased with the increased dividend yield, and anything that might endanger that would be frowned upon.”
Shares in MTN gained R1.09 to R181.70 in mid morning trade on the JSE on Wednesday (10 July), off only R6.00 from its record high, and giving the group a market cap of R341.95 billion.