Vimpelcom, a leading Russian mobile operator with a broad international presence, announced last week that it would sell its 49% stake in Vietnam’s GTel Mobile, a JV it had set up in mid-2009 with local Global Telecommunications Corporation.
Under the terms of the $45 million deal, the Russian telco is relinquishing operational control of GTel Mobile and sanctioning a six-month transition period for the Vietnamese partner to discontinue use of the Beeline trademark.
The move caps Vimpelcom’s prior resolution to bow out of the entire southeast Asian regional market. The firm impaired its Vietnamese investment in Q4 2011 following a major reassessment of its local operations. According to VimpelCom CEO Jo Lunder, giving up on Vietnam comes within the operator’s broader decision to re-channel capital to “those markets where we see the best opportunities to generate shareholder value.”
Vimpelcom is leaving a heavily invested market, with 1,950 base stations built and 20,000 Beeline-branded sales outlets opened in the first year of operation alone. As of Jan. 1, 2010 the Russian operator covered 32% of Vietnam’s entire population.
Vimpelcom’s initial commitment was $1.8 billion, to be forked out over a 15-year period. In April 2011, following some renegotiations with GTel, the Russian telco aired plans to put up a total of $500 million for its Vietnamese asset through 2013.
Vimpelcom provides voice and data services through a range of landline and broadband mobile technologies in Russia, Italy, Ukraine, Kazakhstan, Uzbekistan, Tajikistan, Armenia, Georgia, Kyrgyzstan, Vietnam, Cambodia, Laos, Algeria, Bangladesh, Pakistan, Burundi, Zimbabwe, the Central African Republic and Canada. According to its corporate website, the company’s global operations cover territory with a total population of approximately 864 million people.
Egypt’s Weather Investments II owns 29.6% of VimpelCom’s voting shares. Other stockholders include Norway’s Telenor (25%), Russia’s Altimo (24.998%) and Cyprus’ Forrielite, Ltd. (5.995%), with minority stockholders owning the remaining 14.4%.
