Report: Rostelecom mulls merging mobile assets into Tele2

Speculation about how Rostelecom will grow its mobile business took a further turn this week after reports suggested the Russian group may enter a deal that would result in its mobile assets being merged with those of rival Tele2 Russia.

Citing a report in Russian daily Vedomosti, Reuters said Rostelecom may cede control of its mobile assets to VTB and banker Yuri Kovalchuk, who own shares in Tele2 after VTB sold half of Tele2 Russia to affiliates of Kovalchuk's Bank Rossiya and tycoon Alexei Mordashov.

VTB bought the Russian unit of Sweden's Tele2 in April for $3.55 billion (€2.63 billion) including debt.

Bank Rossiya, Rostelecom and VTB declined to comment, according to Reuters.

It has previously been speculated that Tele2 Russia could join with Rostelecom, which has an LTE licence, to challenge the top three mobile players MTS, VimpelCom and MegaFon.

According to Vedomosti, Rostelecom could get a stake of between 40 and 49 per cent in the combined mobile company, while VTB and Kovalchuk will get 51-60 per cent. Rostelecom would then be free to focus on its cable TV and broadband Internet business.

In August, the Moscow Times reported that Rostelecom was planning to sharpen its focus on the mobile market in what was described as a "strategic change of direction" for the Russian operator, setting up a separate unit to manage its mobile business, building an LTE network based on existing 450 MHz mobile infrastructure used by its Sky Link subsidiary, and expanding its 3G network.

Rostelecom also said in August that it had commercially launched 3G networks in 21 Russian regions alongside one LTE network in Sochi, and said it was making good progress toward establishing future growth areas for the company.

For more:
- see this Reuters article

Related Articles:
Tele2 stake sale raises hopes of more Russian competition
Rostelecom targets mobile growth
Russia's MegaFon gains LTE edge with $1.2B Scartel/Yota purchase
Russia's move to LTE represents a multibillion-dollar opportunity for vendors
Russia's MTS targets quad-play, outlines LTE and data ambitions

Suggested Articles

Wireless operators can provide 5G services with spectrum bands both above and below 6 GHz—but that doesn't mean that all countries will let them.

Here are the stories we’re tracking today.

The 5G Mobile Network Architecture research project will implement two 5G use cases in real-world test beds.