Sunday, 26 February 2017

Telia CEO says Eurasia exit 'highly probable' this year

By Nick Wood, Total Telecom
Friday 27 January 17

Sweden-based telco returns to Q4 profit on Yoigo sale.

Telia Company CEO Johan Dennelind on Friday said it is highly probable that the Sweden-based telco group will sell its remaining Eurasian assets during 2017. Telia opted to exit the region in September 2015 following bribery allegations stemming from its entry into Uzbekistan in 2007, and amid rumours of unethical practices at some of its other Eurasian businesses…

Telia Company CEO Johan Dennelind on Friday said it is highly probable that the Sweden-based telco group will sell its remaining Eurasian assets during 2017.

Telia opted to exit the region in September 2015 following bribery allegations stemming from its entry into Uzbekistan in 2007, and amid rumours of unethical practices at some of its other Eurasian businesses.

In April 2016, Telia sold its Nepalese arm Ncell to Malaysia's Axiata, and months later it agreed to sell its stake in Tajikistan's Tcell to its local partner, the Aga Khan Fund for Economic Development (AKFED). Earlier in the year, Turkcell submitted an offer for Telia's stake in Fintur Holdings, which owns stakes in Georgia's Geocell, Moldova's Moldcell, and Azercell in Azerbaijan.

"We see it as highly probable that the Eurasian assets will be disposed during 2017," said Dennelind, in a statement.

"When it comes to the disposal of Fintur Holdings, we have seen an increased interest in our assets following the decision to explore a joint divestment of Fintur Holdings together with Turkcell," he said.

The most difficult asset to offload, he said, will be Ucell, the Uzbek operation that was subject to investigations by U.S. and Dutch authorities, which have proposed a settlement of $1.45 billion.

Telia is also on the hunt for acquisitions that will strengthen its position in the Nordics and Baltics. In November, Telia agreed to acquire Norwegian SME provider Phonero for €253 million. Swedish news reports have also linked Telia with a move for Danish incumbent TDC.

"When it comes to Denmark, as of now we don't see risk and valuation as attractive for a larger acquisition in Denmark and will continue to review our strategic options," Dennelind said.

His comments were made alongside the publication of Telia's fourth quarter financial results.

In the three months to 31 December, group revenue edged down to 21.13 billion kronor (€2.23 billion) from SEK22.64 billion a year earlier, following the divestment of Spanish arm Yoigo in 2016.

The sale of Yoigo to Spanish telco Masmovil was completed in October 2016, and helped Telia return to profit during the quarter. The company earned SEK7.33 billion, compared to a year-earlier loss of SEK2.63 billion.

Telia ended December with 16.70 million mobile subscribers, down from 20.03 million at the end of 2015. Its fixed broadband customer base stayed broadly flat at 2.56 million.

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