The American company that owns Golden Telecom's Russian parent firm has sold out to Russia's Alfa Group and two investment funds
A group of powerful investors are acquiring a major stake in the parent of Ukraine’s Golden Telecom. The change is not expected to have an immediate effect on the company, however.
Russia’s Alfa Group financial concern and two large investment funds have agreed to buy a combined 50 percent stake in Golden Telecom, Inc., parent company of Ukraine’s Golden Telecom. The buyers are paying $125 million for the stake, with the deal expected to be finalized next month.
Alfa Group will pay $110 million for a 43.8 percent stake in Golden Telecom, Inc., while two investment funds, Baring Vostok Capital and Capital International, are paying $15 million for the remainder. The funds will end up with a combined stake of 16.4 percent in Golden Telecom.
The firms are buying the shares from Global TeleSystems (GTS), a U.S. firm said to be losing interest in the region. Under the deal, Alfa Group and the two funds are also acquiring the right to buy out GTS’ remaining 11.7 percent of shares in Golden Telecom in the future.
Ukraine’s Golden Telecom said in a news release that it hopes a reshuffle in its corporate structure will provide a boost to the company.
“The deal can be viewed by Golden Telecom as a positive development because, unlike Global TeleSystems, the new owners of Golden Telecom, Inc., link their business development prospects with companies working in the CIS,” the company said.
However, John Rose, a spokesman for Golden Telecom, Inc., in Moscow told the Post that shareholder changes in his company are unlikely to change the firm’s investment plans, including those for Golden Telecom’s daughter company in Ukraine.
“It’s nice to have a strong financial group among Golden Telecom’s shareholders now,” Rose said. “But nothing is changed in our planning.”
He said Golden Telecom will make “whatever investment needed” to retain the company’s current market share in Ukraine, though he wouldn’t cite figures.
According to Vyacheslav Fedchenko, a spokesman for Ukraine’s Golden Telecom GSM, Golden Telecom pumped $60 million into its businesses in Ukraine last year and is planning to invest another $20 million this year.
Golden Telecom’s businesses in Ukraine include mobile phone services, fixed lines, and Internet and data transmission services. Fedchenko said the company’s GSM 1800 mobile phone network currently has 43,000 subscribers.
