Iliad founder Niel buys Ukraine's third-largest mobile provider

VEON

10/09/2024 06:38

By Gianluca Lo Nostro
       Sept 10 (Reuters) - A consortium of investors led by
French billionaire Xavier Niel has closed the transaction to
acquire and merge Ukrainian mobile operator Lifecell with
service provider Datagroup-Volia, the investment firms involved
in the deal said on Monday.
    
    WHY IT IS IMPORTANT
Lifecell is Ukraine's third-largest mobile provider after VEON's
 VON.AS  Kyivstar and Vodafone  VOD.L . The operator will merge
with Datagroup-Volia, a fixed-telecom and pay-TV firm.
Lifecell was fully owned by Turkcell  TCELL.IS . In April, a
Kyiv court cleared the path for the acquisition by lifting the
seizure of Lifecell's shares belonging to sanctioned Russian
billionaire Mikhail Fridman, who held approximately a 20% stake
through LetterOne.
    
    KEY QUOTE
"The closing of this landmark transaction will serve as a signal
to others that Ukraine offers compelling opportunities, and that
the time to invest is now," Niel said in a statement.
    
    BY THE NUMBERS
The deal is worth at least $524.3 million, Turkcell said on
Monday. The European Bank for Reconstruction and Development
(EBRD) and the International Finance Corporation will provide
$435 million in loans, the firms added.
The new platform is expected to rack up around 10 million mobile
users, and more than 4 million people connected via fixed-access
network.
    
    CONTEXT
NJJ Holding, the leading investor alongside Horizon Capital, is
one of Niel's investment vehicles. It is the sole owner of Atlas
Investissement, which is also the top shareholder of telecoms
group Millicom  MICC.F . 
Iliad, at the core of Niel's overarching telco busines, will not
be the parent company of this new Ukrainian provider, its CEO
Thomas Reynaud told Reuters in August.
    
    WHAT'S NEXT
The international player emerging from this merger may improve
competition among convergent operators in Ukraine's telecoms
triopoly, Kyivstar's CEO told Reuters on Thursday while the war
with Russia weighs on mobile providers' resiliency.

 (Reporting by Gianluca Lo Nostro; Editing by Kim Coghill)
 ((gianluca.lonostro@thomsonreuters.com;))