VEON, a leading global provider of connectivity and internet services, this week announced the successful conclusion of the transaction for the sale of its Russian tower assets to Service-Telecom.
Following VEON’s entry into an agreement to sell its mobile network towers in Russia to Service-Telecom as announced on 6 September 2021, regulatory approvals have been obtained by the parties and this transaction has now successfully completed. The transaction involves the sale of 100% of National Tower Company (NTC), a subsidiary of VEON, which operates a portfolio of approximately 15,400 mobile network towers in Russia.
The purchase price for the transaction of RUB70.65bn (USD957mn equivalent) corresponds to an EV/EBITDA multiple of 11.7x based on the projected EBITDA of National Tower Company post-completion. VEON has received a payment of RUB64.4bn (USD872mn equivalent) at closing and the balance of certain deferred amounts will be due and payable over the next three years. The proceeds from this transaction will be used to reduce Group external debt.
The conclusion of this transaction paves the way for the establishment of a long-term partnership pursuant to a master tower agreement that has been entered into between Vimpelcom and Service-Telecom.
Kaan Terzioglu, VEON’s CEO
This transaction unlocks the value of our infrastructure assets in Russia and allows the release of capital to further optimise VEON’s balance sheet while at the same time achieving more financial flexibility for the group.
Service-Telecom CEO Nikolay Berdin
By entering this transaction with VimpelCom, we'll continue to successfully run the business to develop a national mobile network infrastructure that matches the country's ambitions.
