South Africa's communications department said on Tuesday it supported in principle a proposed tie-up between MTN Group and India's Bharti Airtel, aimed at creating the world's No. 3 mobile operator.

The two companies, which have been working on a complex $23 billion cash and share swap since May 25, have extended its talks to Sept. 30, after previously extending discussions by a month to Aug. 31.

Tiyani Rikhotso, spokesman for communications department, said in principle the government supported the proposed transaction if it followed the country's mergers and acquisitions rules.

"In principle, yes, it appears to be a good proposal especially given the fact it happen within the framework of south-south cooperation," Rikhotso said.

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