Bharti forms SPVs to execute Zain assets acquisition

Bharti Airtel has formed two special purpose vehicles in the Netherlands and Singapore to execute its $9-billion acquisition of Zain's African assets, The Economic Times today reported.

The acquired assets will be owned by the SPVs who will also repay the debt from the cash flows from the African operations. However, in case of a default, Bharti would step in, it said.

On Thursday, Bharti has said it was close to signing a pact for purchase of Kuwait-based Zain group's African assets to gain a foothold in the frontier market at its third attempt.

Earlier on Sunday, Bharti had said it had put in place the entire financing requirement of $8.3 billion of the planned acquisition through a host of banks.

According to the newspaper which cited an identified source familiar with the deal, the $5.5 billion would be routed through the Netherlands entity while the balance would be routed through the

The report also said that Zain agreed to compensate Bharti for legal costs in case of ownership issues over the crucial Nigerian operations, with generate around 36 per cent of its African revenues.