Tele2 completes €2.7b sale of Russian unit

Nordic telecom operator Tele2 said Thursday it had completed the sale of its Russian unit, Tele2 Russia, to state-owned bank VTB Group.
 
Tele2 struck a deal with VTB Group last week to sell its Russian assets for $3.5 billion (€2.7 billion), which comprises a cash transaction of $2.4 billion in equity value and $1.15 billion in net debt.
 
Mike Parton, chairman of Tele2 AB, said: “This is an excellent result for Tele2 shareholders. Our cash investment in this business was 6 billion krona” (€710.6 million), “and this has generated a cash return of over 27 billion krona including the transaction, much of which has been returned to our shareholders.”
 
Yet the transaction was closed in such an unusual rapid speed amid controversy as VTB’s offer was lower than two other rival bidders. Rival operators, MTS and VimpelCom had teamed up to bid $4-4.25 billion for Tele2Russia.
 
Other bidder include A1, which is owned by Russian billionaire Mikhail Fridman also offered $3.6-$4 billion and threatening legal action against Tele2 and its adviser Morgan Stanley, according to Reuters.
 
With 23 million subscribers, Tele2 Russia is the country's fourth-biggest mobile operator after MTS, MegaFon and Vimpelcom.

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