VimpelCom announced a possible change of owners


Prospect for sale

VimpelCom, the parent company of the eponymous Russian mobile operator, reported to the Commission on securities and stock exchanges of the USA (SEC), on behalf of the owners have registered them for the right to sell ordinary shares; this is stated in the prospectus of the holding company. The announcement is about 1.6 billion ordinary shares of VimpelCom — their number coincides with the total fraction of the investment company LetterOne, controlled by Russian billionaires Mikhail Fridman, German Khan and Alexei Kuz’micheva, and Norwegian telecommunication company Telenor. At LetterOne, according to the latest disclosure, 56.2 per cent in ordinary shares, 47.9% of the voting rights, and Telenor, are 33 and 43%, respectively.

VimpelCom’s market capitalization on NASDAQ is $7.4 billion Based on these data the market value of 89.2% of the shares of the company is $6.6 billion

The prospectus explained that now the shareholders can sell any package of their ordinary shares. The document also lists the methods that can be used for sale, among them is selling on-exchange or OTC markets, through ordinary brokerage transactions or privately owned; also, these methods can be combined.

Such prospectus of VimpelCom published in may 2014, but it did not specify the number of shares which may relate to the sale, notes “Interfax”. Then, the source Agency in the holding explained that it has a technical meaning and does not mean that any of the shareholders of VimpelCom intends to sell its stake. From the definition of the name prospect — shelf registration (the”backup registration”) — that is published on SEC form allows you to register in advance and one Avenue of action intended for immediate or future sale. The sale of shares can be followed through several years after the filing of the shelf registration any number of transactions.

This technical document is required to meet the requirements of the Commission on securities and stock exchanges, to ensure flexibility for shareholders, the representative of VimpelCom. The prospect needed, as in the accounts of VimpelCom’s 20-F for the year 2015 reflected that more is “known Issuer” (well-known seasoned issuer). This status allowed the company’s shareholders to sell their shares without the issue of a supplementary prospectus. The company was taken from him because of the decision by the “Uzbek case”, in which it agreed with the US authorities on payment of $795 million fine for settlement of the case about bribes, said the representative of VimpelCom.

Will sell

A source familiar with plans of shareholders of VimpelCom, said that, most likely, a “notice” will use only Telenor. Intention to sell its stake in VimpelCom representatives of the Norwegian company announced in October 2015. Telenor in VimpelCom has invested 15 billion Norwegian kroner (about $1.8 billion at the exchange rate at the date of the message), receiving a 20 billion kroner ($2.4 billion) in the form of dividends, noted in the company message. “The decision to exit the business of VimpelCom based on our belief that we will be better able to create value in our core areas of activity”, — stated in October 2015, representative of Telenor.

The document is of a technical nature, it is necessary that the shareholders had the opportunity to sell its stake in the company, and filed with the Commission on securities and exchange, with the consent of Telenor, said the representative of the Norwegian operator. He did not comment on when and how Telenor will sell its stake and whether potential buyers. A source close to one of shareholders of VimpelCom, said that Telenor is not a buyer for its stake in VimpelCom. According to the interlocutor , the Norwegians will be likely to gradually sell its stake in the market.

LetterOne is not going to leave VimpelCom, said several interlocutors informed. A source close to shareholders LetterOne, said that holding the share in VimpelCom “does not sell and is not going to [sell]”. According to another source close to LetterOne, the Russian shareholders claim for sale, a package of VimpelCom since LetterOne “and so a strong position in the company.”

According to the newspaper “Vedomosti”, the shareholders of LetterOne still negotiating the sale of its stake in the operator with the Hong Kong holding company Hutchison. Such talks were heard and two sources close to VimpelCom shareholders. According to one of them, the Russian asset, VimpelCom — in a potential deal is not involved. Another source clarifies that “the script is the exit from the Russian “daughter” also considered” but does not know the final decision.

At the end of 2015, the shareholders of VimpelCom had discussed the possibility of a merger with Tele2 Russia, informed Vedomosti in early 2016. The source then added that the talks touched upon tower infrastructure operators. Details, he did not specify. Now talks of “VimpelCom” on cooperation with Tele2 moved into a “phase of silence”, knows a source close to shareholders of the operator.

The representative of LetterOne not responded to the request .

Global operator

VimpelCom owns mobile operators in Russia, Ukraine and other countries of the former USSR, in Italy and Africa. Operators, shares in VimpelCom which has more than 217 million mobile subscribers. The last few years, the company systematically disposed of assets in non-key markets. So, she sold their shares in companies in Namibia (Powercom), Vietnam (GTEL Mobile), Cambodia (Sotelco), Burundi and Central African Republic (Telecel Globe), Algeria (Orascom Telecom Algerie). In November 2015 VimpelCom has announced that it is preparing to sell its assets in Zimbabwe for $40 million — the deal should be the final step in the termination of activity of the operator on the markets of Central and southern Africa.

With the participation of Irina Uzbekova