Telenor Proposes Kyivstar Sale

Telenor proposes that VimpelCom acquire Kyivstar for $5B in cash, rather than shares as VimpelCom has offered

March 20, 2006

1 Min Read

FORNEBU, Norway, MOSCOW, and KIEV, Ukraine -- Telenor today proposed that Russian mobile operator VimpelCom acquire 100% of Ukrainian mobile operator Kyivstar for cash. Telenor believes that if the transaction is completed as proposed, it will be beneficial for Kyivstar, VimpelCom and VimpelCom's shareholders, as well as for Telenor's shareholders, and will create a framework for ending Alfa's attacks on Telenor's ownership interests in VimpelCom and Kyivstar.

"We have today presented a forward looking proposal that, if implemented on the terms proposed, would enable VimpelCom to continue on its path of growth in Russia and the CIS and allow Kyivstar to be part of that growth," said Telenor Executive Vice President and Head of Eastern/Central Europe, Jan Edvard Thygesen. "However, we are not prepared to sell Kyivstar to VimpelCom unless there is a structure in place that will ensure that Alfa's attacks will end."

Telenor's proposal is a response to VimpelCom's February 8 proposal that VimpelCom acquire Kyivstar for US$5 billion in VimpelCom shares. Telenor has proposed that VimpelCom acquire Kyivstar for not less than US$5 billion in cash, an alternative that VimpelCom CEO Alexander Izosimov indicated was a possibility in his conference call with analysts on February 14. Telenor has set a deadline of March 31 for indications from VimpelCom and Alfa of their intent to pursue discussions concerning Telenor's proposal.

Telenor Group (Nasdaq: TELN)

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