The deal had been moving closer and closer to death’s door in recent days. And today the potential merger between Bharti Airtel, India’s largest mobile phone operator, and South Africa’s MTN Group (MTNOY), Africa’s biggest operator, crossed over the threshold and died.

The $23 billion deal would have created a developing market powerhouse with 200 million subscribers from Johannesburg to Mumbai.

South Africa’s government adamantly denies killing the deal but from my seat it sure looks like the merger died because the South African government insisted that the merged company be jointly listed on the Indian and South African stock exchanges. Indian law doesn’t allow for joint listing. On the day the deal died South Africa’s Communications Minister Siphiwe Nyanda said, “It would be sad if we saw this entity move into the hands and management of foreign nationals. Its management must remain South African.”

So wins and who loses?

MTN wins. The company has lots and lots of growth opportunities ahead of it—it recently added two new markets in Nigeria and Iran. Africa is one of the fastest growing cell phone markets and the company is the biggest dog on the continent. And the company has recently expanded off the continent into the Middle East. Its coverage area now has a population of 500 million.

Bharti Airtel loses. The company is facing increasing pressure in its home market from Indian rival Reliance and global giant Vodafone (VOD). Those two competitors are cutting into Bharti Airtel’s lead in the Indian market. In India Bharti Airtel added a record 8.4 million customers in the last quarter but Reliance and Vodafone added customers in India at an even faster pace. Bharti Airtel’s market share was flat in the period while Reliance and Vodafone picked up share to 18% and 19%, respectively.

Vodafone (VOD) wins. The company, the largest mobile phone company in the world by revenue (and #2 to China Mobile (CHL) by subscribers), has targeted Africa and India for future growth. With the deal dead, for the time being, Vodafone will face two smaller and less efficient operators instead of one giant competitor. Vodafone got into the Indian market by acquiring that country’s #4 operator and Vodafone has already grown that operation into #3. In the fiscal year that ended in March 2009, Vodafone India grew its customer base by 56%.

If you’re interested in investing in MTN, I suggest you let the disappointment over the death of the deal take some of the takeover premium out of the price of the shares.

In valuing Vodafone remember that three-quarters of the company’s business comes from slow growth European markets and that the company’s joint venture with Verizon (VZ) in the United States operates on the CDMA standard, which is incompatible with the GSM standard that Vodafone uses elsewhere in the world.