Golden Telecom bought Corbina and goes to regions with a billion dollars

    Golden Telecom yesterday announced the completion of the acquisition of a 51% stake in Cortec CJSC and its subsidiaries (Corbina Telecom Group of Companies). Alexander Mamut has been appointed Chairman of the Board of Directors of Corbina; he is a co-owner of Corbina.

    The acquisition of Corbin Telecom is a key moment in implementing Golden Telecom's broadband strategy. The company plans to deploy its FTTB networks in 65 major cities of Russia with a total population of about 65 million people, offering broadband services and Triple-play services in about 65% of all households. The average number of apartments in a residential building is 100-120, with an average of 2.8 people per apartment. Thus, coverage will be provided for approximately 15.6 million households, or 42.3 million people.

    Within five years, Golden Telecom promises to become the largest fixed-line operator in Russia, more than Svyazinvest. The company plans to invest from $ 1 billion to $ 1.5 billion in network development over four years. These investments will be the largest in the history of Russian fixed telephony.

    The Corbina Telecom broadband network will become the basis for the regional expansion of Golden Telecom. Today, this network covers about 2.6 million apartments in Moscow, St. Petersburg, Yaroslavl, Tula, Orenburg and Kaluga. The company’s network serves more than 200,000 users, providing broadband Internet access services, including approximately 90,000 subscribers connected in the first five months of 2007.

    Both companies have already entered the market with a common product. Starting May 1, 2007, Corbina Telecom home Internet subscribers in Moscow can use the Golden WiFi service - wireless Internet access from anywhere in Moscow that has Golden WiFi coverage. Now the Golden WiFi network consists of approximately 7.5 thousand access points and covers about 800 thousand households, open areas and the most popular public places in the city.

    “We aim to increase the speed of Internet access throughout Russia to global heights,” said Alexander Malis. “My dream is Internet access throughout Russia, unlimited in speed and unlimited in traffic,” said Alexander Malis, CEO of Corbin Telecom.

    Commenting on the deal, Jean-Pierre Vandromme, Golden Telecom’s General Manager, said: “The acquisition will greatly accelerate the deployment of our FTTB networks by pooling the resources and experience of both companies. Corbina Telecom has already entered the group of leaders in the broadband access services market in Moscow, and Golden Telecom has managed to gain strong positions in key regional centers of Russia. By combining services based on VoIP, IPTV and MVN (mobile virtual network), we can offer the mass user the product Quadric-Play. These services will make it possible to position Golden Telecom as a unique and interesting player in the telecommunications market, which completely coincides with our strategy aimed at turning Golden Telecom a leading fixed-line operator in Russia and the CIS. ”

    Jean-Pierre Vandromme also said that his company’s investment in the development of a fixed line network in Russia by the end of 2010 will be from $ 1 billion to $ 1.5 billion. Within five years, Golden Telecom will try to become the largest fixed-line operator in Russia, more than Svyazinvest. Currently, the combined share of Golden Telecom and Corbina Telecom in the fixed-line telephony market in Moscow is 19%, and in Russia as a whole - 14-15%, and by 2011 it is planned to increase it to 50%.

    Money for expansion will be received from the Corbina placement, which is planned at the end of 2008 (no site has been selected yet). Mamut and partners plan to sell 25% of the company for about $ 250 million, and then they can issue an additional issue.

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