October 5, 2015 at 16:56Vimpelcom Ltd, the second largest shareholder, will sell its share due to the drop in operator capitalization
Norwegian telecommunications company Telenor has decided to get rid of its stake in of Vimpelcom Ltd . Telenor is one of the largest telecommunications companies in the world. Vimpelcom Holding conducts telecommunications business in the CIS countries, Italy and in several countries of Asia and Africa. In Russia, it is also known under the Beeline brand.
“Telenor does not have the ability to fully control the activities of this asset. Therefore, the board of directors and the CEO of Telenor decided to leave Vimpelcom Ltd in the interests of their shareholders and in accordance with the long-term strategy of the group, ”company representatives said. The market value of a stake in Vimpelcom is only 8% of Telenor's capitalization and it is constantly decreasing, they note.
Telenor owns a 33% stake in Vimpelcom and is the second largest shareholder of the company. Another 56.2% (47.9% of the vote) of Vimpelcom is with LetterOne , owned by the owners of Alfa Group .
Telenor invested NOK 15 billion in Vimpelcom and received NOK 20 billion in dividends. Telenor representatives estimate the market value of their stake in Vimpelcom at NOK 20 billion (approximately $ 2.4 billion at the current exchange rate).
In the third quarter, the price per share of Vimpelcom on the stock exchange fell to $ 4.11. The carrying amount is $ 5.64 per share. But in its calculations, Telenor will be guided by the market value of the asset. By the end of Q3, Telenor's share will depreciate by another 7.5 billion NOK, experts say. However, the company said that no specific deadlines have been set for leaving Vimpelcom.
VimpelCom100% owned by Vimpelcom Ltd. According to the results of the II quarter, the company had 57.2 million subscribers in Russia. The company employs 27,000 employees. The revenue of VimpelCom in the II quarter of 2015 decreased by 1% to 68 billion rubles, according to the operator’s quarterly reporting. EBITDA decreased by 3.3% to 27.5 million rubles. EBITDA margin decreased from 41.4 a year earlier to 40.5%. The representative of Vimpelcom Ltd Artem Minaev told Vedomosti that the company is aware of Telenor’s intentions to sell the holding’s shares.
Telenor became a shareholder of the Russian company VimpelCom in 1998. The company planned to further increase its stake and obtain a controlling stake in the operator. However, after a few years, the shares of the Norwegian company were transferred to Alfa Group. This has led to a long stock conflict.
In 2009, the international company Vimpelcom Ltd was established with headquarters in Amsterdam. She combined the Russian VimpelCom and the Ukrainian Kyivstar, which belonged to Telenor and Alfa Group. In 2011, Vimpelcom teamed up with Wind Telecom , which was owned by Egyptian entrepreneur Naguib Saviris. Thus, the operator entered the markets of Pakistan and Bangladesh, where it had already provided Telenor services. As a result, Vimpelcom began to compete with its own shareholder.
After the merger, the shares of the main shareholders eroded, including the Telenor voting shareholding dropped to 25.1%.
Telenor then bought back 11.35% of Vimpelcom's voting shares from an Egyptian businessman for $ 374.4 million. As a result, the package of Norwegians returned to the previous level - 36.36% of voting shares. But this deal was challenged in court by the Federal Antimonopoly Service of the Russian Federation (FAS). The fact is that the Norwegians did not agree on it in advance with the Russian government.
In 2013, Telenor CEO and President Jon Fredrik Bakosos, in an interview with Vedomosti, recalled that until the spring of 2016, Norwegians still have the right to convert Vimpelcom preferred shares into ordinary shares, redeeming 305 million shares from the company at market value. This will not change the number of votes due to Telenor, but will increase its share in dividend payments from 33% to 43%. But today, Telenor said it was not going to convert prefs.
"Kommersant" recalls that the reason for the exit from Vimpelcom could be a corruption storyaround the daughter of the president of Uzbekistan Gulnara Karimova. Allegedly Vimpelcom, the Russian MTS and the Swedish-Finnish TeliaSonera were suspected of giving bribes to Karimova. In July, the US Department of Justice received permission from a New York Southern District court to arrest $ 300 million in accounts of companies associated with the Islam Karimov family.
Sources of Kommersant said that, including because of this scandal, Telenor President Yun Fredrik Baksos was forced to retire ahead of schedule. For the same reason, Vimpelcom’s Supervisory Board has been abandoned this year by its many-year-old members: Hjell-Morten Johnsen, Executive Vice President for Telenor Operations in Europe and Ole Bjorn Schulstad, who headed the Russian office after him.
“Telenor does not have the ability to fully control the activities of this asset. Therefore, the board of directors and the CEO of Telenor decided to leave Vimpelcom Ltd in the interests of their shareholders and in accordance with the long-term strategy of the group, ”company representatives said. The market value of a stake in Vimpelcom is only 8% of Telenor's capitalization and it is constantly decreasing, they note.
Telenor owns a 33% stake in Vimpelcom and is the second largest shareholder of the company. Another 56.2% (47.9% of the vote) of Vimpelcom is with LetterOne , owned by the owners of Alfa Group .
Telenor invested NOK 15 billion in Vimpelcom and received NOK 20 billion in dividends. Telenor representatives estimate the market value of their stake in Vimpelcom at NOK 20 billion (approximately $ 2.4 billion at the current exchange rate).
In the third quarter, the price per share of Vimpelcom on the stock exchange fell to $ 4.11. The carrying amount is $ 5.64 per share. But in its calculations, Telenor will be guided by the market value of the asset. By the end of Q3, Telenor's share will depreciate by another 7.5 billion NOK, experts say. However, the company said that no specific deadlines have been set for leaving Vimpelcom.
VimpelCom100% owned by Vimpelcom Ltd. According to the results of the II quarter, the company had 57.2 million subscribers in Russia. The company employs 27,000 employees. The revenue of VimpelCom in the II quarter of 2015 decreased by 1% to 68 billion rubles, according to the operator’s quarterly reporting. EBITDA decreased by 3.3% to 27.5 million rubles. EBITDA margin decreased from 41.4 a year earlier to 40.5%. The representative of Vimpelcom Ltd Artem Minaev told Vedomosti that the company is aware of Telenor’s intentions to sell the holding’s shares.
Telenor became a shareholder of the Russian company VimpelCom in 1998. The company planned to further increase its stake and obtain a controlling stake in the operator. However, after a few years, the shares of the Norwegian company were transferred to Alfa Group. This has led to a long stock conflict.
In 2009, the international company Vimpelcom Ltd was established with headquarters in Amsterdam. She combined the Russian VimpelCom and the Ukrainian Kyivstar, which belonged to Telenor and Alfa Group. In 2011, Vimpelcom teamed up with Wind Telecom , which was owned by Egyptian entrepreneur Naguib Saviris. Thus, the operator entered the markets of Pakistan and Bangladesh, where it had already provided Telenor services. As a result, Vimpelcom began to compete with its own shareholder.
After the merger, the shares of the main shareholders eroded, including the Telenor voting shareholding dropped to 25.1%.
Telenor then bought back 11.35% of Vimpelcom's voting shares from an Egyptian businessman for $ 374.4 million. As a result, the package of Norwegians returned to the previous level - 36.36% of voting shares. But this deal was challenged in court by the Federal Antimonopoly Service of the Russian Federation (FAS). The fact is that the Norwegians did not agree on it in advance with the Russian government.
In 2013, Telenor CEO and President Jon Fredrik Bakosos, in an interview with Vedomosti, recalled that until the spring of 2016, Norwegians still have the right to convert Vimpelcom preferred shares into ordinary shares, redeeming 305 million shares from the company at market value. This will not change the number of votes due to Telenor, but will increase its share in dividend payments from 33% to 43%. But today, Telenor said it was not going to convert prefs.
"Kommersant" recalls that the reason for the exit from Vimpelcom could be a corruption storyaround the daughter of the president of Uzbekistan Gulnara Karimova. Allegedly Vimpelcom, the Russian MTS and the Swedish-Finnish TeliaSonera were suspected of giving bribes to Karimova. In July, the US Department of Justice received permission from a New York Southern District court to arrest $ 300 million in accounts of companies associated with the Islam Karimov family.
Sources of Kommersant said that, including because of this scandal, Telenor President Yun Fredrik Baksos was forced to retire ahead of schedule. For the same reason, Vimpelcom’s Supervisory Board has been abandoned this year by its many-year-old members: Hjell-Morten Johnsen, Executive Vice President for Telenor Operations in Europe and Ole Bjorn Schulstad, who headed the Russian office after him.