MOSCOW-Russian wireless carrier VimpelCom announced it has won a tender against international bidders to purchase KaR-Tel, the second-largest cellular operator in Kazakhstan, for $350 million plus assumption of $75 million in debt.
KaR-Tel holds a national GSM 900 MHz license and serves about 600,000 subscribers, a 31-percent market share in Kazakhstan, according to company estimates. Recognizing the benefits of local expertise, VimpelCom said it is also in discussions with a Kazakh partner to sell for cash at the same pricing terms as paid by VimpelCom a minority interest of up to 50 percent minus one share in KaR-Tel. VimpelCom intends to retain control of KaR-Tel, with no less than 50-percent plus one share ownership. The closing of both the purchase of KaR-Tel by VimpelCom and the sale of a stake in KaR-Tel to a partner are expected to occur in the second half of 2004.
“We are very pleased to announce this acquisition in Kazakhstan as VimpelCom’s first expansion outside of Russia,” said Alexander Izosimov, chief executive officer of VimpelCom. “This move opens a new chapter in our development, reflecting our vision of VimpelCom as an international company with a strong presence in developing markets, particularly within the CIS.”
VimpelCom said Kazakhstan has the highest gross domestic product per capita in the Commonwealth of Independent States after Russia and a cellular penetration rate of 13 percent.
VimpelCom’s Russian rival Mobile Telesystems holds stakes in several foreign wireless carriers. VimpelCom also reported second-quarter financials, with its net profit rising to $90.96 million, short of analysts’ expectations.
