Cellular operator Veon to offer Russian business for $2.2 bln

Cellular operator Veon to offer Russian business for .2 bln
  • This written content was made in Russia, in which the legislation restricts protection of Russian armed forces functions in Ukraine

MOSCOW, Nov 24 (Reuters) – Amsterdam-listed cellular operator Veon (VON.AS) stated on Thursday it would promote its Russian organization, Vimpelcom, to senior users of the Vimpelcom administration staff, led by CEO Aleksander Torbakhov, for 130 billion roubles ($2.2 billion)

Veon operates the Beeline brand name via Vimpelcom in Russia, a sector that accounts for about 50 % of team revenue. Veon also operates Beeline in Kazakhstan and Kyivstar in Ukraine.

Veon, which expects the transaction to be full by June 1, joins a expanding listing of Western firms that have bought belongings in Russia since Moscow sent tens of hundreds of troops into Ukraine on Feb. 24.

Veon stated the administration buyout of Vimpelcom implied an anticipated organization worth of around 370 billion roubles. Even though Veon is offering at a low cost, the transaction represents a somewhat scarce instance of cash transforming hands involving events as organizations race to exit Russia.

Japan’s Nissan (7201.T) took a $687 million reduction in handing in excess of its business in Russia to a state-owned entity for one particular euro, mirroring an earlier transfer by Renault (RENA.PA) which offered its bulk stake in Russia’s Avtovaz for a person rouble. Several businesses have not disclosed the value of their divestments.

The agreement includes a provision that permits Veon to profit from Vimpelcom marketing at a increased valuation for a period of time of 30 months just after the offer closes.

Veon’s shares rose 8.6% in slender trade in Amsterdam to .57 euros as of 1532 GMT. The shares have traded in close proximity to report lows because tumbling after Russia started what it phone calls its “unique armed service operation” in Ukraine.

“The administration buyout of our Russian operations will reward all concerned,” Veon CEO Kaan Terzioglu said in a assertion to Reuters.

“Consumers and personnel will see a seamless transition, investors and bondholders will see a deleveraging of our equilibrium sheet, and Veon will be capable to aim on our electronic operator approach across our portfolio of running countries.”

Veon’s Kazakhstan operations will be transferred to Veon Holdings as element of the transaction and specified inter-enterprise loans will be extinguished, Veon explained.

Torbakhov explained the offer marked an essential milestone for Beeline.

“The leading management crew represented by me, Svetlana Kirsanova, Maxim Zaikov, Valeriy Shorzhin and Renat Nasretdinov managed to form the most balanced offer for Veon Group, that ensured its victory in the competitive approach on offering the asset,” Torbakhov stated.

($1 = 60.3500 roubles)

Reporting by Alexander Marrow in Moscow and Supantha Mukherjee in Stockholm additional reporting by Jake Cordell and Toby Sterling
Modifying by Male Faulconbridge, David Goodman, Mark Potter and Sandra Maler

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