One of Russia’s largest operators is acquiring a 50% stake in the country’s market-leading mobile retailer. MegaFon will pay US$1.3 billion for the holding in Euroset, which has around 5500 outlets across Russia and Belarus.
The operator will acquire two separate stakes of 25% for US$590 million, one of which will be bought by an investment vehicle under the aegis of MegaFon’s main shareholder, Alisher Usmanov. This stake will then be acquired by MegaFon proper within three years.
The acquisition may have been motivated by a need to increase MegaFon’s retail presence; the operator currently franchises 2000 shops and owns 1750. Another factor may be that rival VimpelCom owns the other 50% of Euroset.