Operators

Kyrgyz govt steps in to buy Veon’s stake in Beeline Kyrgyzstan

Kyrgyz govt steps in to buy Veon’s stake in Beeline Kyrgyzstan

Global digital operator Veon said on Wednesday it has completed the sale of its 50.1% indirect stake in Kyrgyzstan mobile operator Sky Mobile (a.k.a. Beeline Kyrgyzstan) – but to the government via state-owned Eldik Bank, and not CG Cell Technologies as originally planned.

Veon announced its intention to sell the stake – which was held by VIP Kyrgyzstan Holding AG – in March 2024 to CG Cell Technologies, a wholly owned subsidiary of Dubai-based conglomerate CG Corp Global.

However, Veon said the Kyrgyz government exercised its right of first refusal and designated Eldik Bank to acquire 100% of Beeline Kyrgyzstan on its behalf. No reason was given why the government objected to CG Cell Technologies taking a majority stake in Beeline.

The sale was conducted through Sky Mobile’s parent company Menacrest AG. Eldik Bank paid the full transaction value after all necessary regulatory approvals were obtained.

The amount of the transaction was undisclosed. According to statement from CG Cell Technologies on Wednesday announcing the termination of its acquisition agreement with Veon, the original deal was valued at US$32 million.

Veon said the sale is part of its strategy to simplify the group’s structure and focus on its large markets where it can create scale with its ‘DO1440’ digital operator model, providing digital services in finance, entertainment, healthcare and education.

That said, according to Veon’s 2023 results, while Beeline Kyrgyzstan has done well in terms of revenue growth and EBITDA, it has also been the lowest revenue contributor to the group, compared to Veon’s operations in Ukraine, Pakistan, Kazakhstan, Bangladesh, Uzbekistan and Georgia.

“Beeline Kyrgyzstan has excelled in expanding 4G coverage and advancing our digital operator model, and we are confident this exceptional team will continue to thrive under Eldik Bank’s ownership,” said Veon group CEO Kaan Terzioglu in a statement.



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