Ken Costa, the veteran London-based banker, has been appointed by Reliance Communications, the second largest Indian mobile company, to advise on its negotiations with MTN, Africa's largest wireless group.

The two companies are locked in exclusive talks that could create a new colossus in emerging mobile markets with a market value of more than £35 billion.

Mr Costa last year moved to Lazard, where he is chairman of its international business and co-head of UK investment banking, from UBS, where he had spent more than three decades. The Reliance advisory role will be seen as a coup for the dealmaker, who rivals say was brought in to bolster Lazard's profile, which had recently slipped on big-ticket mandates.

It is thought that the options being discussed by Reliance and MTN involve an arrangement under which Anil Ambani, the billionaire head of the Indian group, would take 34 per cent of an enlarged MTN – a holding that would leave him the largest single stakeholder but would not trigger an obligatory open offer for the remainder of the South African company.

Between them Reliance and MTN boast a customer base of more than 116 million subscribers, annual revenues of $14 billion and strong footholds across India, Africa and the Middle East – some of the most attractive territories in the global mobile market. Combined, the companies would form the fourth-largest mobile group in the world, after China Mobile, Vodafone and China Unicom.

Any significant combination of MTN and Reliance would also have to assuage political concerns in South Africa over the fate of one of the country's most highly-valued companies. MTN has close ties with South Africa's ruling ANC party. The company's chairman is Cyril Ramaphosa, one of an influential set of former ANC politicians turned businessmen.

The MTN-Reliance talks come amid what could turn out to be a watershed period for the African mobile industry. This week Vodafone sought to gain control of Vodacom, the African mobile group of which it currently owns 50 per cent, by paying $2.5 billion for a further 12.5 per cent. The British company is understood to have run the numbers on a possible bid for MTN, but decided against such a move.

Meanwhile, Mvelaphanda Holdings, a leading South African black empowerment group, is heading a consortium that is mulling a bid for Telkom, which owns the other 50 per cent of Vodacom and is the country's biggest fixed-line company.

Lazard is also said to have won a role advising brewer InBev on a possible bid for Anheuser Busch, a deal that could be valued at more than $45 billion. A spokesman for the bank was not immediately available to comment.

Mr Costa's past deals include the relocation of Anglo American, the mining giant, from Johannesburg to London, and the acquisition of the Ritz by the Barclay brothers, Sir David and Sir Frederick, in 1995. Earlier this year he advised Olivant, the investment vehicle owned by the former UBS executive Luqman Arnold on its failed bid for Northern Rock.

In his youth Mr Costa, who was born in South Africa, led the students' council at the University of the Witwatersrand in Johannesburg, then a centre for anti-apartheid activism.

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