Reliance Communications in talks to acquire African assets of Zain

India's second largest mobile operator, Reliance Communications, is in talks to acquire part of Kuwaiti Telecom operator Zain's sub-Sahara African operations, in a deal, which could be over $10 billion.

Zain, whose majority shareholder is Kuwait Investment Authority, the oil rich sheikhdom's sovereign wealth fund, followed by a privately owned family company, the Kharafi group, is negotiating with two other firms to sell their stake in the African operations, retaining the profitable ones in Morocco and Sudan.

Other companies in the race for the acquisition are Zain's Gulf rival, Abu Dhabi-based Etisalat, and French media-and-telecoms group Vivendi, while China Mobile and Vodafone could also emerge as potential buyers.

Zain, the Gulf Arab region's third-largest telecom firm by market value, which had moved its headquarters to Bahrain recently, has called for an extraordinary general meeting on 31 August to vote on removing share ownership restrictions, an indication that the company is ready to sell a part of its operations.

The company said last month that it had appointed Swiss bank UBS to help it review its overall strategy, which included disposing off some of its assets.

Zain plans to use the money to lower its debt and roll out 3G networks at a fast pace in the Gulf region. It already operates in 17 African countries under the Celtel brand, and has invested more than $12 billion in Africa.