Telenor CEO says VimpelCom stake sale still at planning stage

Sigve Brekke, Telenor president and CEO
Telenor Group CEO Sigve Brekke

Telenor CEO Sigve Brekke revealed the operator is still debating how to sell its stake in VimpelCom some 10 months after the Norway-headquartered company announced its decision to offload the holding.

Brekke told Reuters that Telenor is consulting with financial advisors to devise an exit strategy, but that the operator is currently uncertain how a sale deal would be structured. The news agency added that JP Morgan is guiding Telenor through the process.

The operator holds a 33 per cent stake in VimpelCom, with Russian billionaire Mikhail Fridman’s Letter One Technology company the other major stakeholder with a 48 per cent share.

When it originally announced its plan to sell out of VimpelCom, Telenor cited its inability to guide the operator’s strategy as a key reason. However, the decision came as VimpelCom was being investigated by U.S. and Dutch authorities over allegations of corruption, making it likely that the probes were another motivator for Telenor.

VimpelCom subsequently settled the investigations, after agreeing to pay a total of $795 million (€702 million) in fines and disgorgements.

Analysts told Reuters that Telenor’s plan to sell is being held up by a lack of potential buyers. Haarvard Nilsson, an analyst at investment bank Carnegie, said Fridman is the only viable buyer for Telenor’s stake as it stands.

Telenor could opt to separate VimpelCom’s Russian and European operations in the hope that the units would be more attractive to potential buyers as standalone businesses, Nilsson added.

Brekke told Reuters that Telenor is focused on growing its presence in markets including Asia Pacific. For example, the operator plans to take part in forthcoming spectrum auctions in Thailand. The country is gearing up to sell new frequencies in the 2300 MHz and 2600 MHz bands in 2017, and plans to re-auction frequencies in the 1800 MHz band in 2018, the news agency reported.

For more:
- see this Reuters report

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