AMSTERDAM, Sept. 6, 2021 /PRNewswire/ -- VEON Ltd. (NASDAQ:
VEON) (Euronext Amsterdam: VEON), a leading global provider of
connectivity and internet services, announces today that it has
reached agreement to sell its mobile network towers in Russia to Service-Telecom for a total
consideration of RUB70.65bn
(USD970million equivalent).
Service-Telecom is a well-known partner to PJSC VimpelCom, which
operates in Russia under the
Beeline brand, and already provides the company with passive
infrastructure across various regions in Russia.
The sale reflects VEON's continued focus on active portfolio
management and the pursuit of opportunities to realise the value of
its infrastructure portfolio. With over 50,000 towers across nine
dynamic markets, it is one of the industry's largest.
The transaction involves the sale of 100% of National Tower
Company ("NTC"), a subsidiary of VEON, which operates a portfolio
of approximately 15,400 mobile network towers in Russia. All of the active mobile network
infrastructure currently operated by PJSC VimpelCom and the
majority of the rooftop towers will remain with the company.
Under the terms of the deal, PJSC VimpelCom and Service-Telecom
have entered into a long-term master agreement regarding the
provision of tower infrastructure services for an initial period of
8 years, and multiple extensions of 8 years at the discretion of
PJSC VimpelCom. Both parties will additionally enter into a new
build-to-suit program comprising of up to 5,000 sites by 2029.
The master agreement provides a framework for a long-term
strategic partnership with Service-Telecom to pursue investments in
network roll-out and upgrade, and share the benefits from potential
future infrastructure market consolidation in Russia. The agreement also provides Beeline
with strict service commitments and protections enabling Beeline to
place an even greater focus on ongoing strategic initiatives and
improve the quality of mobile services for its customers.
The purchase price for the transaction of RUB70.65bn (USD970m
equivalent) corresponds to an EV/EBITDA multiple of 11.7x 2021
based on projected EBITDA of NTC post-completion.
The transaction is subject to customary regulatory approvals and
closing is expected to take place in the fourth quarter of
2021.
Commenting on the transaction, Kaan
Terzioglu, VEON's Chief Executive Officer, said: "Today's
transaction is a major step forward in realising the value of
VEON's infrastructure portfolio for our shareholders. By entering
into a long-term partnership with a strong, experienced
counterparty in Russia, Beeline
will enjoy the operational and financial flexibility to serve its
customers with market-leading services through one of the nation's
largest and most technologically-advanced mobile networks.
Moreover, this transaction allows to release the capital to
deleverage VEON's balance sheet and invest in critical aspects of
active network and digital opportunities while achieving more
financial flexibility."
Service-Telecom CEO Nikolay
Berdin noted: "The agreement reached with VEON is a
key achievement for Service-Telecom on its way to becoming a
leading telecommunication infrastructure operator in Russia. With PJSC VimpelCom as our partner, we
expect to drive sustainable long-term growth in Russia while constructing the infrastructure
backbone of the digital economy and helping to enhance mobile
broadband connectivity for consumers."
Disclaimer
This release contains "forward-looking statements", as the
phrase is defined in Section 27A of the U.S. Securities Act of
1933, as amended, and Section 21E of the U.S. Securities Exchange
Act of 1934, as amended. Forward-looking statements are not
historical facts, and include statements relating to, among other
things, expectations regarding the potential benefits of the
transaction described above. Forward-looking statements are
inherently subject to risks and uncertainties, many of which VEON
cannot predict with accuracy and some of which VEON might not even
anticipate. The forward-looking statements contained in this
release speak only as of the date of this release. VEON does not
undertake to publicly update, except as required by U.S. federal
securities laws, any forward-looking statement to reflect events or
circumstances after such dates or to reflect the occurrence of
unanticipated events. Furthermore, elements of this release contain
or may contain, "inside information" as defined under the Market
Abuse Regulation (EU) No. 596/2014.
About VEON
VEON is a NASDAQ and Euronext Amsterdam-listed global provider
of connectivity and internet services.
For more information visit: www.veon.com.
About Service-Telecom
Group of companies "Service-Telecom" is an independent operator
of wireless telecommunications infrastructure. Service-Telecom
operates in major regions of Russia. The leader in independent
infrastructure providers in terms of portfolio growth and
operational efficiency. For more information visit:
www.service-telecom.net
VEON Contact Information
Communications & Investor Relations
Nik Kershaw
ir@veon.com
+31 20 79 77 200
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SOURCE VEON Ltd