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UPDATE 2-Bharti Airtel gets approach for controlling stake in mobile tower arm

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* Bharti Airtel says no certainty about a deal

* Q2 profit 3.43 bln rupees vs forecast 3.03 bln rupees

* Revenue down 11.7 pct

* Financial stress in industry continues - CEO (Recasts to add investors' proposal to buy Bharti Airtel's tower arm)

MUMBAI/BENGALURU, Oct 31 (Reuters) - Bharti Airtel Ltd said on Tuesday it had been approached by global investors interested in a controlling stake in its mobile masts unit Bharti Infratel Ltd.

India's largest phone carrier also reported its smallest quarterly profit in nearly five years, hurt by a price war.

The news of the approach from unidentified investors comes a day after Bharti Infratel said it was considering buying the rest of Indus Towers, the biggest mobile mast operator in India.

Indian media have reported a consortium led by private equity firm KKR & Co LP is eyeing both Bharti Infratel and Indus Towers.

Indus Towers, which runs nearly 123,000 towers, is owned 42 percent each by Bharti Infratel and Vodafone's Indian unit. Third-ranked mobile carrier Idea Cellular along with its associate owns the remainder.

"Airtel has been approached by a few reputed global investors to acquire a significant stake in Bharti Infratel which, if accepted, could result in such investors acquiring control of Bharti Infratel," Bharti Airtel said in a statement.

It added a panel of its directors recommended the proposal be considered, but said discussions had not started and there was no certainty of a deal.

Bharti Airtel, like its peers, has been struggling amid a price war in the world's No.2 mobile phone market triggered by the market entry late last year of Jio, Reliance Industries' telecoms venture which is backed by India's richest man Mukesh Ambani.

The sector faces further pressure after India's telecoms regulator this month cut the fee operators pay each other for calls made from one network to another.

Bharti Airtel's Indian Chief Executive Gopal Vittal on Tuesday warned the financial stress in the sector would be "further accentuated" by the cut in interconnection fees, which benefited established players.

Net profit fell 77 percent from a year earlier to 3.43 billion rupees ($53 million) in its second quarter to September, Bharti Airtel said, which was its smallest profit since the quarter to December 2012 but still better than analysts' estimate of 3.03 billion rupees.

Revenue in the quarter fell 11.7 percent from a year earlier to 217.77 billion rupees, said Bharti Airtel, which operates in 17 countries across Asia and Africa.

SHEDDING DEBT

India's telecoms market, comprising 1.2 billion subscribers, is heavily indebted due to years of pricey airwaves auctions and cash-burning tariffs as wireless carriers jostle to win customers.

To shed debt, telecom companies are increasing looking to spin off their mobile mast businesses while focussing on core mobile services.

Bharti's plan to engage with investors to sell a stake in Infratel comes at a time debt-laden Reliance Communications is also trying to sell its mobile towers to Canada's Brookfield.

Bharti's net debt stood at 914.8 billion rupees at end-September.

Jio's free voice and cut-price data plans have also pushed rivals such as Bharti to reduce rates, while forcing smaller players to either regroup or exit.

Vodafone Group Plc's India unit and Idea Cellular , the country's No. 2 and No. 3 players respectively, have agreed to merge operations while Bharti is taking over Norwegian Telenor's local unit and Tata conglomerate's money-losing mobile business. ($1 = 64.7475 Indian rupees) (Reporting by Sankalp Phartiyal and Tanvi Mehta, additional reporting by Abhirup Roy and Devidutta Tripathy; Editing by Susan Fenton and Mark Potter)