Tele2 readying 20 bln rubles in 10-yr bonds
MOSCOW. Dec 20 (Interfax) - T2 Rus Holding LLC, the parent company of the holding Tele2 Russia, is planning a 20 billion-ruble issue of ten-year bonds, the company said.
The first series will be of 10 billion rubles, the second and third of 5 billion rubles each, the company said.
The primary aim of the new bond program is refinancing two bond issues to the tune of seven billion rubles, a Tele2 representative told Interfax.
There are at present six OJSC St. Petersburg Telecom bond issues in circulation, totaling 26 billion rubles. St. Petersburg Telecom is part of the Tele2 holding.
The next offer will be for the fourth and fifth series - three and four billion rubles, respectively - will be in February.
T2 Rus Holding recently wrapped up the consolidation of 100% of the regional operators making up Tele2 Russia. The company's charter capital is 76.5 billion rubles. Earlier, the Swedish outfit Tele2 Russia Holding AB, controlled by VTB , had owned all the operating companies.
T2 Rus Holding was set up this July after VTB acquired Tele2 Russia. The company will be the core in an upcoming deal with OJSC Rostelecom approved by the state telecom holding's board of directors on December 12.
Rostelecom will acquire a 45% stake in T2 Rus Holding (the joint venture will be renamed T2 RTK Holding), and the owners of Tele2 - VTB, and outfits associated with Yury Kovalchuk and Alexei Mordashov - will retain 55%.
Rostelecom will be putting into the JV mobile assets CJSC AKOS, CJSC Volgograd-HMS. CJSC NSS, CJSC ETK, CJSC BVK, CJSC BIT, and CJSC Sky Link.
The JV will also receive Rostelecom mobile assets worth over $1 billion.
The other mobile assets remaining on Rostelecom's balance sheet will be spun off into CJSC RT-Mobile, and also go into the JV. The matter of separating off RT-Mobile will be on the agenda for a December 30 Rostelecom EGM. RT-Mobile will get federal LTE (long-term evolution) license for 2.3-2.4 gigahertz, 80 megahertz, and 2.5-2.7 gigahertz, a cellular business in the Urals, equipment and contracts.
Rostelecom will raise its economic stake in the JV to 45% once RT-Mobile has been transferred into it.
The first stage of the deal will be closed in the first quarter of 2014 and the second at the end of the first half.
The united operator might conduct an IPO over the course of three years, in which case Rostelecom will have the right to increase its stake to controlling, Rostelecom President Sergei Kalugin said.
Rostelecom provides mobile communications services to 14.1 million subscribers (up 4% since Q3 2012) in 35 Russian regions. It has licenses to provide services on the GSM standard (territorially complementing Tele2's licenses), 3G (lacking at Tele2) and LTE throughout Russia (a minimum of five regions will be launched before the end of 2013).
Rostelecom revenue from the mobile business declined 6% in the third quarter of 2013 to 9.88 billion rubles. The segment accounts for about 13% of Rostelecom's consolidated revenue.
Tele2 Russia currently provides mobile services in 41 regions of Russia. Revenue totaled 17 billion rubles in the third quarter, 10% more year-on-year. The subscriber base is 23.7 million people, 6% more than a year earlier.
Rostelecom has a 6% share of the mobile market by subscribers and Tele2 has 10%. The united T2 Rus Holding will have about 38 million subscribers (as of the third quarter). Pro forma revenue in 2012 was 101 billion rubles.