Amsterdam-based telco VimpelCom is reportedly in talks with rivals of its Italian unit Wind Mobile about consolidation in the local market.
The Financial Times quoted VimpelCom CEO Jo Lunder as saying his company is involved in discussions and “will…
Amsterdam-based telco VimpelCom is reportedly in talks with rivals of its Italian unit Wind Mobile about consolidation in the local market.
The Financial Times quoted VimpelCom CEO Jo Lunder as saying his company is involved in discussions and “will explore opportunities” in Italy and other markets. Lunder reportedly added that VimpelCom has a “very positive view on Italy” and believes Europe could be a “good” region going forward.
Incumbent Telecom Italia (TI)’s recent talks with Hong Kong’s Hutchison Whampoa about merging their mobile units, called off in early July, prompted speculation that the market could experience a shake-up.
TI’s plan to spin-off its fixed-line assets into a new company, likely to trigger major regulatory changes, has also fuelled the rumours. Numerous analysts have predicted there will be a reduction in mobile players.
VimpelCom, whose two largest shareholders are oligarch Mikhail Fridman’s Altimo and Norway’s Telenor, recently disposed of units in Asia and Central Africa, refocusing on its core European operations. The FT report quoted Lunder as saying that, when these sales close, the business portfolio will be “more or less” complete.
Presenting its Q2 2013 results yesterday (7 August), Vimpelcom also confirmed it is considering selling its stake in Wind Canada, which has been strongly linked with a sale to Verizon Communications in local press. Vimpelcom had previously sought to take over the Canadian business but ran into regulatory difficulties in June.
Tele2 Russia still a target
On a conference call with analysts yesterday, Lunder also confirmed VimpelCom is still interested in acquiring Tele2 Russia, which state-controlled banking group VTB bought from its Swedish parent for US$3.55bn earlier this year.
Offers for Tele2 Russia from VimpelCom in partnership with the nation’s largest mobile operator MTS and, separately, Alfa Group Consortium’s investment arm A1 were rejected.
“Clearly the big strategic question is what’s going to happen to Tele2?” Lunder asked. “Is it ending up with Rostelecom or someone else? We are still very interested in acquiring Tele2.”
VTB has made it clear it intends to sell at least a stake in Tele2 Russia, saying it has held talks with potential buyers from Russia and internationally. Speculation about an eventual merger between Tele2 Russia and state-controlled Rostelecom has continued for some time.
A Rostelecom spokesperson confirmed in June that the two companies were discussing an MVNO agreement, noting that Rostelecom is “exploring different opportunities to cooperate with Tele2 Russia”.
VimpelCom reported revenues for the second quarter of US$5.7bn, representing organic growth of 1% year-on-year. In yesterday’s conference call with analysts, Lunder highlighted the positive performance of VimpelCom’s Russian and Italian operations, saying that in Italy “we continue to outperform our competitors in what remains a highly-competitive market”.
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