HiTech.Expert

In February, revenues of enterprises from provision of communication services decreased by 6.2% compared with January, from UAH 3,963.498 million to UAH 3,717.381 million, the State Statistics Service has informed Ukrainian News. The general decrease in the revenues was caused by a decrease in revenues from mobile cellular communications services. Operators revenues from provision of mobile cellular communications services went down by 7.9%, the stake of revenues was 59.1%. In January-February, total revenues of enterprises from communications services made up UAH 7,666.914 million. As Ukrainian News earlier reported, in January 2011, revenues of enterprises from provision of communication services fell by 2.5% compared with December 2010, from UAH 4,067.125 million to UAH 3,963.498 million. In 2010, revenues of enterprises from provision of communication services made up UAH 47,432.675 million.

Experts expects Initial Public Offering of Ukrtelecom, the largest telecommunication company in Ukraine, on foreign exchanges in the 2014-2016 period. "If the company takes the path of restructuring, which is probable, IPO would be rational in three years," said Volodymyr Klymenko, director of the investment-banking department of the Socrat investment group. Yehor Samusenko, an analyst of the Concorde Capital investment company, also expects IPO of Ukrtelecom no sooner than in three years. He noted that IPO is an alternative to the sale of the company to a strategic investor. Viacheslav Ivanishyn, an analyst of the TASK Investment Group, sees as equal two options: IPO of Ukrtelecom (in three or five years) and sale of the company to a strategic investor. Ivanishyn added that one of the companies that could not take part in the tender for restrictions of the privatization terms (such as Deutsche Telekom) can show interest in purchasing Ukrtelecom. As Ukrainian News reported, the State Property Fund of Ukraine on March 11 sold 92.79% in Ukrtelecom to the ESU Company (Kyiv), a subsidiary of the Austrian Investment-Financial Consortium EPIC, for UAH 10.575 billion.

Stock market players notice insignificant influence of the sale by the State Property Fund of 92.8% of shares in Ukrtelecom, Ukraine's biggest telecommunication company, to ESU (Kyiv; subsidiary of the European Privatisation and Investment Corporation, EPIC, Austria) on Ukrtelecom quotations. "The trading in Ukrtelecom shares opened at 57 kopecks a share. The peak was at the level of 58.8 at about 11:20. And then Ukrtelecom slid down abruptly and by noon reached 56.6 kopecks a share. It now trades in this range," said Andrii Tarasenko, the head of the investment consulting department at Upras Capital. In his opinion, they expect no split-off or separation of some of the company assets after its privatisation, as this is not allowed by the privatisation conditions. Viacheslav Ivanyshyn, an analyst at the TASK Investing Group, says that a slight growth of Ukrtelecom quotations was observed right next to the announcement of the sale of the 92.8-percent stake in the company, although soon the upward movement changed for a fall in the price of the stock. "Was a little growth upwards, and then Ukrtelecom shares 'fell in' again. This means the stock market players don't believe in further runup of the company shares," he said. Ivanyshyn also takes as unlikely split-off of the telecom company after the sale of 92.8% of shares in it. Mykhailo Roiko, the president of equity firms at Amadeus Asset Management (Kyiv), has stressed that the dynamics of the cost of Ukrtelecom shares coincide with the general dynamics of the market, which testified to insignificant influence of the sale 92.8% of shares in the company on quotations of its securities. As Ukrainian News earlier reported, the State Property Fund of Ukraine on March 11 sold 92.79% of shares in Ukrtelecom to ESU for UAH 10.575 billion.

The MTS Ukraine mobile communications operator appointed Serhii Ivaniuta as its financial director on March 11. Ivaniuta held the post of financial director at the AES Ukraine company (AES Kyivoblenerho, AES Rivneenerho, AES Enerholine, and AES WH BV) from 2003. The post of financial director at MTS was previously held by Mark Burden, who was appointed as the vice president for finance at the Volia company on September 27, 2010. Oleksandr Sarvachov was the acting financial director from September 27 to March 11. As Ukrainian News earlier reported, MTS reported a net profit of UAH 640.3 million for the year 2009, when its net revenues reduced by UAH 421.5 million or 4.9% to UAH 8,172.7 million compared with 2008. Mobile Telesystems (Russia) owns 100% of the shares in MTS Ukraine.

A new owner will unlikely make reshuffles in Ukrtelecom management, according to experts. "Only a shareholder can say whether Dzekon (Hrigoriy Dzekon, CEO of Ukrtelecom - HiTech.Expert) will be dismissed. I should note that there isn't any appropriate candidate in Ukraine to replace Dzekon," Yehor Samusenko, Concorde Capital analyst, said. Yet, the company may attract several top executives from abroad, he noted. The same opinion was expressed by Viacheslav Ivanyshyn, analyst for the TASK investment group. "Ukrtelecom management will unlikely be replaced because the Austrian EPIC is associated with the incumbent management," he noted. Ivanyshyn admits that the new owner can enhance management by that in charge of investment and financial affairs. However, Volodymyr Klymenko, director of the investment banking department of the Sokrat investment group, thinks that the new owner will radically change the company's management. Heorhii Dzekon, Ukrtelecom board chairman, may either stay in his office or will be offered another high position during a year after the company's privatization, Klymenko predicts. As Ukrainian News reported, the State Property Fund of Ukraine on March 11 sold 92.79% in Ukrtelecom to the ESU Company (Kyiv), a subsidiary of the Austrian Investment-Financial Consortium EPIC, for UAH 10.575 billion.