Russia’s MegaFon has formed a new joint venture with the government of Uzbekistan that will assume control over Ucell, formerly a unit of Telia.
Ucell has been run by Uzbekistan’s government since December 2018, when Sweden’s Telia exited the market by selling its remaining holding in the unit. Ucell was at the centre of a bribery scandal that eventually led to Telia pulling out of the Eurasia region entirely and refocusing on its core markets.
Uzbekistan’s state asset management firm AUGU has now formed a new joint venture with Digital Invest, a new unit set up by MegaFon’s parent firm USM Telecom. Known as Digital Holding, the new venture will take control over Ucell.
Once the deal is finalised – which is anticipated before the end of 2021 – ownership of Digital Holding will be split 51:49 between MegaFon and AUGU, with Digital Invest pledging investment of $100 million into the unit.
MegaFon CEO Gevork Vermishyan said: “In terms of the consumption of digital services, Uzbekistan is one of the most promising markets in the CIS, which over the past ten years has shown more than threefold growth in cellular subscribers, but at the same time it is still far from saturation.”
“We do not plan major structural changes within Ucell in 2021, but rather focus on finding synergies and implementing best practices in Ucell to grow its business”, added Vermishyan.