Vimpelcom Ltd. closes $88 mln deal 1.5 yrs after signing agreement
MOSCOW. March 10 (Interfax) - Vimpelcom Ltd. has finally closed the purchase of a stake in Laotian cellular operator Millicom Lao Co. from the Luxembourg-based holding Millicom International Cellular S.A. a year and a half after the sale agreement was signed.
Vimplecom reported that it had paid the Dutch holding Millicom Holding Laos B.V. - holder of 78% of Millicom Lao - $65 million, and that another $23 million had been put toward paying of debts, including intra-group owings. The other 22% of the operator belongs to the Laotian government.
The purchase deal was concluded in September 2009, prior to the creation of Vimpelcom Ltd., into the creation of which Alfa Group and Telenor wasted little time folding Russian 'big-3' telecom VimpelCom and Kyivstar of Ukraine.
One of the reasons for the multi-year Telenor/Alfa dispute was a conflict of interests between the Norwegian holding, which put its emphasis on its own development in developing countries, with Vimpelcom. However, Telenor does not operate in Laos.
Initially, Vimpelcom had planned to wrap up the deal before the end of 2009, but it the process was drawn out due to a lack of local regulatory approval, which put the sale under a cloud of doubt. The seller said last March that Vimpelcom had not met its obligations in the share-acquisition. Millicom International said at the time that it was retaining its rights as stipulated in the agreement, including the right to seek compensation for the Laotian asset's loss of value from Vimpelcom, which had decided not to complete the deal.
Millicom Lao is that country's second largest cellular operator, ending the month of February with more than 500,000 subscribers. It commands a roughly 25% market share, well ahead of Lao Telecom.
Vimpelcom's expansion outside the Commonwealth of Independent States began in 2008-2009 with its entry onto the markets of Vietnam and Cambodia. Its development in these two countries is at this point taking differing shapes: in the latter, the company has joined the top three companies by number of subscribers; but in the former, Vimpelcom has had to "slow down temporarily" because of differences over financing with its local partner, the company said.
