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MTN's No. 2 Shareholder

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Azmi Mikati, CEO of the family's M1 Group, told Reuters in a telephone interview that a proposed deal, under which the firms take stakes in each other, was "fair for all parties" and said the family would back it if a firm offer was made.

"We are fully supportive of the transaction. It will add value for both Bharti Airtel and MTN shareholders," Mikati said.

"We are fully behind the transaction and the management of MTN. We will vote in favour of it. We don't look at any transaction with short-term view, but through a long-term view."

MTN, Africa's biggest mobile operator and Bharti, India's leading cellular firm, have revived talks aimed at creating the world's third-biggest wireless group with more than 200 million subscribers and combined revenue of $20 billion.

They are discussing an initial cash and share swap deal worth more than $23 billion that could lead to a full merger of the companies, which have a combined market value of about $60 billion based on current market prices.

The Mikati family owns about 10 per cent of MTN via the M1 Group, making it the second biggest shareholder after South African state pension fund Public Investment Corporation.

The Mikati family is the first major MTN shareholder to publicly support the deal, which smaller investors have said is skewed in Bharti's favour. They want the terms to be sweetened.

Shares in MTN extended losses after the comments, falling 1.1 per cent to 118.21 rand in brisk volume, lagging a 2-per cent firmer JSE Top-40 index of blue-chip stocks.

Bharti Airtel shares closed 3 per cent higher at 819.65 rupees, outperforming the broader Mumbai market, which gained 2.3 per cent.

The Mikati family became a major MTN shareholder when the South African firm bought its majority-owned Middle East operator Investcom in 2006.