According to the sources Reliance Communication (RCOM) and MTN of S. Africa have agreed upon the swapping of majority shares in each other’s companies. Anil Ambani of RCOM may acquire 34% stake in MTN after direct investment. A delegation from RCOM has moved to Johannesburg the head office of MTN for further negotiation. Besides discussing the share swap ratio the parties are also discussing the structure of the management of the entity, post merger. There are no reports of complete overhauling of existing management.

 

The main advisers along with financial advisor Deutsche Bank are Lehman Brothers, JP Morgan and Lazard. Ken Costa of Lazard is leading RCOM in the negotiation. Both parties are ruling out the time deadline of the completion of agreement. If the deal goes through, the combined entity will have a market capitalization of $66 billion and operations in 23 countries. Earlier there were reports that RCOM had been holding secret talks with MTN even as the latter was finalizing a deal with its rival Bharti Airtel, now time is ripened for RCOM.