VimpelCom, a leading international telecom group and Russian mobile operator, signed agreements last week for the acqusition of a 100% stake in New Telephone Company (NTC) from Korea Telecom and Sumitomo Corporation for $420 million, reported Kommersant, a Russian business daily.
Founded in 1992, NTC is one of Russia’s top ten mobile operators. Korea Telecom, one the largest mobile operators in South Korea, purchased a majority stake in the NTC in 1997 and in 2005 Sumitomo Corporation, a large Japanese industrial trading company, purchased a 20% stake.
NTC offers a complete range of telecom services, including mobile and landline services, broadband Internet, Internet Protocol TV (IPTV), and IP telephony. According to estimates by AC & M Consulting, a Russian consulting firm specialized in telecommunications and media, NTC controls 40% of the market in the Vladivostok region. MTS, MegaFon and VimpelCom – Russia’s three leading mobile operators – had a respective 28%, 24% and 1% share in the regional market before the new acquisition.
Both MTS and Megaphone had also made bids for NTC, but in March the Russian Federal Antimonopoly Service (FAS) granted permission for the acquisition of NTC to VimpelCom alone.
Update June 9
VimpelCom has acquired 90% of NTC shares, announced the company. “VimpelCom will launch a mandatory tender offer under Russian law to acquire the remaining 10% of the outstanding NTC shares. Completion of the tender offer is expected to occur in the third quarter of 2011. The acquisition price for 100% of NTC shares is based on an Enterprise Value of US$ 420 million. The major shareholders of NTC are KT Corporation and Summit Telecom Global Management B.V., a subsidiary of Sumitomo Corporation.”
