* Shares up after talks called off
* Analysts say groups may try again
* MTN CEO faces shareholders' ire
* MTN in mobile content venture with Indian company
(Adds MTN content venture with Indian software firm)
By Serena Chaudhry and Devidutta Tripathy
JOHANNESBURG/NEW DELHI, Oct 1 (Reuters) - Bharti Airtel and MTN Group's shares rallied on Thursday after the telecoms groups failed to seal a $24 billion tie-up, and any future attempts are likely to be viewed sceptically, analysts said.
Talks between India's Bharti and South Africa-based MTN collapsed for the second time in just over a year over South Africa's reluctance to allow a flagship company to lose its national character.
Bharti on Wednesday held out the prospect of talks being revived.
"There definitely appears an intent from the current management to do a deal," said Chris Wood, fund manager at Prudential Portfolio Managers, who owns MTN shares.
The deal, which faced close scrutiny from regulators and politicians, could have led to a full-blown merger.
Shares in MTN jumped as much as 5.98 percent on the Johannesburg bourse while Bharti shares gained as much as 11.58 percent in Mumbai the day after the talks collapsed.
The rand fell over one percent on Wednesday and extended the decline by a further 1.9 percent on Thursday to a near four-week low against the dollar. The transaction would have brought major capital inflows to South Africa.
INVESTORS RELIEVED
MTN shareholders said the stock was worth more than Bharti's offer and Bharti investors were relieved the company will not face a big cash outflow.
"Even though the announcement leaves a small window open for 're-engaging', it lifts uncertainty and could trigger a relief rally in the near term," Citigroup analysts wrote about Bharti.
"However, the risk that Bharti will explore other acquisition options remains," the analysts said.
Analysts and bankers said Bharti's expansion plans were unlikely to be halted by the MTN failure but India's largest mobile operator may now need to focus on smaller deals.
MTN could pursue other opportunities but may find shareholders reluctant to support it, Prudential's Wood said.
"It's not clear what management's incentive to do the transaction was, but it certainly didn't appear that it was being done in the interests of all shareholders," Wood said.
MTN Chief Executive Officer Phuthuma Nhleko has now presided over three failed deals in just over a year and shareholders may demand some answers from him.
"Shareholders are going to be particularly grumpy. He hasn't exactly done himself any favours, with this particular transaction having dragged on for the better part of four months in a period in which we've seen a very strong equity rally and (MTN's) share price, for all intents and purposes, has been capped," Wood said.
MTN said on Thursday it had entered into a partnership with Indian software company IMIMobile to provide mobile and online content to 103 million users in the Middle East and Africa.
The partnership will allow MTN to bring new mobile services faster to the market and also boost Average Revenue per User (ARPU), MTN said.
Before MTN's rally on Thursday, the company's shares had only gained around four percent since the two groups announced they were in talks, compared with a 10.4 percent rise in the JSE Securities Exchange's blue chip Top-40 index.
Bharti stock had risen just 2.4 percent between the firms announcing the revival of talks and Wednesday's close, compared with a 23 percent rise in the broader Indian market.
On Thursday, Bharti stock closed 4 percent higher at a two-week closing high of 435.35 rupees while MTN shares were 5.33 percent higher at 128.66 rand by 1355 GMT -- its highest level in two weeks.
(Writing by Marius Bosch; Editing by Simon Jessop and Elaine Hardcastle)