S.Africa's MTN extends exclusive talks with Reliance

By Gugulakhe Lourie and Rina Chandran

JOHANNESBURG/MUMBAI (Reuters) - South African mobile phone operator MTN Group and India's Reliance Communications have extended exclusive talks on a potential tie-up to create a top-10 global telecom group.

"I can't give you the reason why we have extended the talks," MTN spokeswoman Nozipho January-Bardill told Reuters.

The two-week extension, announced on Wednesday, comes after a claim on shares in the Indian company by Mukesh Ambani, estranged brother of Reliance Communications Chairman Anil Ambani, and a sharp drop in share prices created obstacles to completing a deal by the original deadline of July 8.

The new deadline is July 21.

MTN and Reliance said on Wednesday there was no certainty the discussions would result in a deal.

"I'm sorry I can't comment on anything other than that," the spokeswoman said when asked if MTN was confident the brothers would iron out their differences so the deal could go through.

MTN shares initially rose 2.17 percent, and later pared its gains to trade 0.36 percent higher at 128.50 rand.

Consultants Frost & Sullivan, said the potential value of the deal to both MTN and Reliance Communications was too great to try to conclude negotiations quickly.