Rostelecom’s board of directors has approved a transaction to buy the remaining 55% of Tele2 Russia the company does not already own.
The acquisition is expected to be completed in three parts. The first will be of a 10% stake through an exchange of 10% of ordinary Rostelecom shares held by the Rostelecom subsidiary for R24 billion (€338.9 million), while the second will be of a 27.5% stake using cash proceeds received from an additional share issue of Rostelcom ordinary shares awarded to VTB for a value of R66 billion. The third will be of a 17.5% stake for cash at a valuation determined by an independent appraiser, equal to R42 billion.
Tele2 is the fastest growing mobile operator in Russia and the deal will complement Rostelecom’s digital services with new convergent offerings. It will also help Rostelecom in the upcoming rollout of 5G services.
Following completion Tele2 Russia will remain a separate legal entity, with its existing management in place.
Rostelecom group strategy will be renewed and unveiled in the first half of 2020.
