Telecom Lead Europe: Tele2 AB has decided to sell Tele2 Russia to VTB Group for $2.4 billion in cash.
Out of the total consideration of $3.55 billion, $2.4 billion (around SEK 15.6 billion) will be the cash component for equity value and $1.15 billion (around SEK 7.5 billion) in net debt.
Tele2 has around 23 million subscribers in Russia.
Mats Granryd, president and CEO of Tele2 AB, said: “Tele2 AB will carry on investing in and seizing opportunities that surging mobile data usage is creating in our core markets: Sweden, the Netherlands, Norway and Kazakhstan.”
Andrey L. Kostin, president and chairman of VTB Group, said: “Tele2 Russia has a solid track record of growth and profitability in Russia, and a strong regional position as the 4th Russian mobile operator with almost 23 million subscribers.”
Tele2 Russia had net sales in 2012 of SEK 12,984 million and an EBITDA result of SEK 4,744 million. The operations have around 3,500 employees.
The transaction is estimated to result in a capital gain excluding reversal of exchange rate differences previously reported in Other comprehensive income amounting to approximately SEK 15.6 billion and will affect the results for Q2 2013.
Tele2 AB will maintain its focus on Europe and Eurasia. Tele2 AB will strive to excel within its core assets, customer relationships and mobile access and innovate within products, price and packaging.
Following the divestment of Russian operations, Tele2 AB expects to achieve a compounded annual revenue growth for the group of between 5 – 7 percent until year 2015, reaching at least SEK 35.6 billion.
Tele2 expects to achieve a compounded annual EBITDA growth for the group of between 10 – 12 percent until year 2015, reaching at least SEK 8.3 billion.
Tele2 AB CEO said the company expects to reach at least net sales of SEK 35.6 billion by 2015 through organic growth.
