Rostelecom, Russia’s national telecommunications operator, is to acquire Qwerty, a Moscow broadband Internet provider, Russian business daily Kommersant revealed earlier this week referring to unnamed sources.
Qwerty is indirectly owned by Svyazinvest, Rostelecom’s main shareholder. Its value has been estimated at 1.2 to 1.4 billion rubles, or around $40 million, by Raiffeisenbank analyst Sergey Libin, Kommersant reported.
Rostelecom is also eyeing another Moscow Internet provider, Gorcom, which occupies 2% of the broadband Internet market in Moscow.
As a result of these expected acquisitions, Rostelecom’s market share in Moscow will reach 14%, putting it ahead of Megafon, a leading Russian mobile operator, which controls 10% of the local broadband Internet market following the acquisition of NetByNet in June. But Rostelecom will still lag behind Moscow broadband Internet and digital television provider Akado and mobile operator VimpelCom, each of which controls about 20% of the market. The leader is MTS, another leading Russian mobile operator, with a 27% market share.
The recent move is yet another step in Rostelecom’s plan to create a combined telecommunication infrastructure and extend its range of services. Not only does Rostelecom operate fixed-line domestic and international telecommunications across the country, it also owns a nationwide fiber-optic backbone network and is developing Internet, VPN, intelligent network services (INS), and videoconferencing, among other services.
Rostelecom is also pursuing some mobile telecommunications ambitions by acquiring regional operators and bidding for GSM licenses in several regions.
“We are creating the first universal operator, [integrating] a variety of networks and services in all regions of Russia,” Rostelecom representative Oleg Rumyantsev said in April.
The operator recently completed a large reorganization and merger process with its regional affiliates.
