Telenor, Alfa agree on Vimpelcom-Kyivstar JV
Four months after ending their bitter dispute over Vimpelcom, Telenor and the Alfa Group today issued an offer to shareholders over consolidating their Ukraine and Russian mobile operations.
The companies have sought the approval of minority shareholders on the long-delayed merger between Russian-based Vimpelcom and Ukraine operator Kyivstar.
Russian regulators last week finally cleared the proposed merger, which would create a $23 billion (€16.81 billion) company with around 88 million subscribers, and annual revenues of $12.6 billion.
However, a second proposed JV between Alfa and Sweden-headquartered Telia Sonera appears to have hit the rocks.
The deal would see Russia’s third-largest carrier Megafon merged with Turkish carrier Turkcell in a 50:50 JV listed on the New York stock exchange.
Regulators are concerned the deal would leave Alfa in too dominant a position, though some press reports suggest the real reason is that Russia’s telecoms ministry wants to merge Megafon with state-owned fixed line carrier Rostelekom to create a Russian incumbent.
Alfa has only been granted permission to pursue one JV deal, and appears content to tie-up with Telenor after burying the hatchet over ownership disputes with the Norwegian telco that date back five years.
Alexander Izosimov, who was previously Vimpelcom CEO, has been reappointed to the post. He said he had only agreed to take the helm on condition that all disputes between Alfa and Telenor had been resolved, FT.com reported.
Just under 30% of the stock is owned by minority investors, and participation is required from 95% of shareholders if the proposal is to pass.
The converged company will retain the Vimpelcom name.