Veon Ltd. decided to sell its Russian unit to some senior members of its management team in the country as the mobile operator attempts to limit the fallout from the war in Ukraine on its business.
(Bloomberg) — Veon Ltd. decided to sell its Russian unit to some senior members of its management team in the country as the mobile operator attempts to limit the fallout from the war in Ukraine on its business.
Veon will receive 130 billion rubles ($2.1 billion) from PJSC VimpelCom’s managers, the company said in a filing on Thursday. The total sum will be paid primarily by taking on Veon’s debt. The deal is expected to be completed by June 2023.
Veon’s share price has fallen by two-thirds this year as the invasion and subsequent sanctions on Russia imposed by the US, EU and UK undermined the company. Its Russian unit accounts for about half of the mobile operator’s revenue.
“Following the conclusion of this transaction, Veon will have greater visibility for regaining access to international debt capital markets,” Chief Executive Officer Kaan Terzioglu told Bloomberg by phone after the announcement.
Veon was founded in Moscow in 1992 as VimpelCom, one of the nation’s first cellular-phone providers. It has grown into a Dutch-domiciled telecommunications giant with more than 217 million customers in nine countries and is the largest mobile operator in Ukraine.
LetterOne Investment Holdings, founded by Russian billionaire Mikhail Fridman, owns 48% of Veon according to data compiled by Bloomberg. Fridman was sanctioned by both the EU and the UK earlier this year, and stepped down from the boards of Veon and LetterOne.
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