The board of directors at Mobile Telecommunications Company, also known as Zain, completed the due diligence process on Wednesday for Bharti Airtel's proposed acquisition of its African operations.
The parties are finalizing definitive agreements, which are expected to be signed in the coming days, Zain of Kuwait said in a statement on Thursday. After signing, the parties will move towards getting any required approvals, it added.
The sale of Zain Africa BV does not include Zain's operations in Sudan or its investment in Morocco, the company said.
Bharti Airtel, India's largest mobile carrier, said last month that it was in exclusive discussions to buy the African operations of Zain, in a deal with an enterprise value of US$10.7 billion. The period for exclusive discussions ends Thursday.
The bid for Zain's operations came after Bharti Airtel failed twice to arrive at an agreement with MTN Group in South Africa. That plan was rejected by the South African government, which wanted to maintain MTN's separate identity.
Bharti Airtel earlier this week said it had tied up the entire financing of $8.3 billion needed for the proposed acquisition of Zain Africa.
The expansion into Africa, where less than 50 percent of the people have mobile phones, presents a good growth opportunity for Bharti Airtel, according to analysts. The Indian market is already saturated with far too many players, and average revenue per user is falling as a result of a tariff war, they added.
In Africa, Zain offers telecommunications services in Burkina Faso, Chad, Democratic Republic of the Congo, Republic of the Congo, Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Sierra Leone, Tanzania, Uganda and Zambia, according to the company's Web site.
By expanding its business outside the country, Bharti Airtel will also gain the economies of scale needed to become more cost-efficient, Kamlesh Bhatia, a principal research analyst at Gartner, said in February.