VimpelCom takes helm at GTEL Mobile
Russian carrier VimpelCom will invest $500 million (€340 million) in its Vietnamese joint venture over the next two years as it seeks to take a controlling 65% stake in the company.
The carrier has already paid $196 million to increase its holding in GTEL Mobile – a joint venture with local firm GTEL – from 40% to 49% and will pump in the additional funds to raise its stake to 65% if performance criteria are met by 2013.
It is the Russian firm’s first major investment since concluding the take over of Wind Telecom - a deal that was hotly disputed by its lead shareholders Telenor and Altimo.
The commitment also lays to rest rumors VimpelCom was considering quitting the joint venture, which has struggled to hold onto subscribers since launching GSM services in 2009. The Russian carrier’s scale will be a key element in turning GTEL Mobile’s business around, director Alexey Blyumin said.
Combined revenues for Beeline mobile services in Cambodia and Vietnam – VimpelCom’s South East Asia region – grew from $2.4 million in 4Q09 to $6.9 million in 4Q10, and OIBDA loss fell from $12.6 million to $9.8 million.