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Turkcell’s Astelit, MTS and VimpelCom win 3G licences in Ukraine

Turkcell’s subsidiary Astelit, along with the Russian operators MTS and VimpelCom, has acquired spectrum to offer 3G services in Ukraine.

Astelit operates in Ukraine under the life:) brand, and won “Lot 1” with its bid of 3,355,400,000 Ukrainian Hryvnia, roughly US$118.4 million. The operator is aiming to launch 3G services in Ukraine 6 months after the acquisition of the licence, and will cover regional centres in Ukraine in 3G within 18 months as required by the Ukrainian regulator.

life:) , in which Turkcell is a 55% shareholder, serves 10.3 million subscribers in Ukraine as of the end of 2014. It has recorded 1.1 million year-on-year growth in subscriber number as of the final quarter of 2014, and currently has a market share of 18%. 36% of its customers are smartphone users, making the operator the market leader in Ukraine in terms of smartphone penetration.

Erdal Yayla, Acting CEO of Astelit, said: “As Ukraine’s leading operator in smartphone penetration, we are in a unique position of contributing even more significantly to Ukraine’s journey to a whole new world of opportunities enabled by 3G.”

VimpelCom’s Ukrainian unit Kyivstar leads the market with a 40% share. The group paid UAH 2.7 billion ($83 million) for its spectrum – an amount matched by MTS.

The ongoing conflict in Ukraine has given rise to reports that the country’s government is aiming to reduce the influence of Russian operators. MTS and VimpelCom collectively share around 8-% of the market. Prime Minister Arseny Yatseniuk went as far as to claim that he would sell a 3G licence to an EU-based operator at the favourable price of just UAH1 ($0.077).

MTS President and CEO Andrei Dubovskov said that the licensing process had been managed in “a very professional manner, while each stage was conducted with the highest level of transparency.”

In November, he had expressed hesitancy over the group’s involvement in Ukraine, saying that “the situation in Ukraine remains highly volatile and creates uncertainty at the group level. It is hard to forecast what the operational trends in Ukraine would be going forward.”

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