Vimpelcom to acquire Italy's Wind, Orascom

4th October 2010, Comments 0 comments

Norwegian-Russian telecoms firm Vimpelcom on Monday said it signed a deal with Egyptian billionaire Naguib Sawiris to buy all of Italian mobile operator Wind and a majority in Egypt's Orascom Telecom.

The agreement will create the world's fifth largest mobile telecoms carrier by subscribers, with pro forma operating revenues of 21.5 billion dollars, Vimpelcom said in a statement on its website.

"At the closing of the transaction, Vimpelcom Ltd will own 51.7 percent of Orascom and 100 percent of Wind," Vimpelcom said in a statement.

The shares are being acquired from the Weather Investments holding company of Sawiris, one of the richest men in the Middle East who is estimated by US Forbes magazine to have a total fortune of 2.5 billion dollars.

The overall value of the transaction was not disclosed but Russian business daily Vedomosti said it would be worth 6.4 billion dollars.

Vimpelcom said that as part of the transaction, Weather Investments will receive a 20 percent economic stake and a 18.5 percent voting stake in the enlarged Vimpelcom group.

Vimpelcom is a joint venture of Norwegian telecoms firm Telenor and Russian banking group Alfa Group, whose creation was sealed at the end of 2009 after a prolonged squabble between the two groups.

Jo Lunder, the Chairman of Vimpelcom, said: "This combination creates a top tier global telecoms company with strong platforms across Europe, Asia and Africa."

Naguib Sawiris said: "This landmark transaction is a true reflection of the high quality of our Orascom Telecom and Wind Italy assets and of the significant value that we have created over the years for our shareholders."

The cash and shares transaction also includes a 1.8 billion dollar payment in cash.

Reports of the deal saw Orascom shares jump more than three percent on the Cairo stock exchange when they were suspended as the regulator asked the company to clarify the reports.

Vimpelcom has licenses for operations across Russia -- where it owns top operator Beeline -- and Ukraine as well as the entire territories of Kazakhstan, Uzbekistan, Tajikistan, Georgia, Armenia, Kyrgyzstan, Vietnam and Cambodia.

© 2010 AFP

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