Mystery foreign bidder lining up for Ukrtelecom alongside domestic, Russian interest

Three companies have expressed an interest in purchasing Ukrtelecom since the Ukrainian government put the former monopoly telco up for sale, the State Property Fund (SPF) claimed yesterday. Two firms are from the CIS region and are assumed to be the pair already strongly linked with the privatisation, namely Russian group Sistema, which includes cellco MTS Ukraine, and domestic conglomerate SCM, owner of fixed line operator Vega and co-owner of cellco Astelit. The SPF said that the third potential bidder is from outside the CIS region, but gave no further details. TeleGeography’s GlobalComms Database notes that the number of potential applicants has been limited by auction conditions banning companies with 25%-or-more state ownership (direct or indirect) – excluding such telcos as Germany’s Deutsche Telekom, Norway’s Telenor (and indirectly, Russia’s Vimpelcom), France Telecom, Russia’s Rostelecom, Sweden’s TeliaSonera and Telekom Austria. Another clause prevents the participation of players with a share of over 25% of Ukraine’s overall telecoms revenues – which reportedly rules out a bid from Vimpelcom-backed Kyivstar. The auction of a 92.8% stake in Ukrtelecom is scheduled for 28 December 2010 with an initial bid price of UAH10.5 billion (USD1.3 billion).

(c) www.telegeography.com

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