Amsterdam-headquartered Veon has agreed to sell its Russian business Vimpelcom for 130 billion roubles (US$2.2 billion).
Reuters reports that the unit is to be acquired by its senior management team, led by CEO Aleksander Torbakhov. Vimpelcom operates mobile provider Beeline in Russia – a market that accounts for around half of Veon’s group revenue. The deal is expected to close by 1st June 2023.
"The top management team represented by me, Svetlana Kirsanova, Maxim Zaikov, Valeriy Shorzhin and Renat Nasretdinov managed to form the most balanced offer for Veon Group, that ensured its victory in the competitive process on selling the asset," said Torbakhov.
"The management buyout of our Russian operations will benefit all involved," said Veon CEO Kaan Terzioglu. "Customers and employees will see a seamless transition, investors and bondholders will see a deleveraging of our balance sheet, and Veon will be able to focus on our digital operator strategy across our portfolio of operating countries."
Veon also operates Beeline in Kazakhstan and Kyivstar in Ukraine.
The expected enterprise value of its Beeline’s Russian operations was 370 billion roubles; while Veon is therefore selling this at below estimated value, it can perhaps be considered fortunate to find a buyer willing to pay a sum that even approaches this valuation.
Following Russia’s invasion of Ukraine in February 2022, overseas firms have scrambled to exit the market, with many incurring tremendous losses. Nissan sold its Russian business to a state-owned company for one euro – losing US$687 million – while prior to this, Renault sold a majority holding in Russia's Avtovaz for one rouble.