VEON group operators in Central Asia able to use the Beeline trademark for at least another five years

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VEON group operators in Central Asia able to use the Beeline trademark for at least another five years - report

MOSCOW. July 25 (Interfax) - Telecommunications holding VEONs assets operating under the Beeline brand will sign amended trademark license agreements with Russia-based VimpelCom after the Russian asset is sold to local management, VEON's annual report says.

VimpelCom has been the licensor of Beeline and Beeline trademarks since 2005.

Each of the operating subsidiaries in Kazakhstan, Kyrgyzstan, Uzbekistan and VimpelCom will enter into amended trademark license agreements.

The term of each license agreement is expected to be amended from an indefinite term to a five year initial term and the termination rights previously held by VimpelCom therein are expected to be narrowed as compared to the original license agreement; no additional fees are expected to be added as part of these amendments.

However, since the License Agreements do not have any renewal terms, such extension may be subject to new terms that differ significantly from the current terms of the License Agreement to the detriment of the operating subsidiaries. "Furthermore, there is no guarantee that any operating company that chooses to pursue an extended license term will be able to negotiate an extension on commercially reasonable terms, or at all," VEON said.

VEON said that alternatively, it may undertake a re-branding exercise in respect of any one or more of our operating subsidiaries that use the Beeline brand. It anticipates that any such rebranding strategy will involve substantial costs and may not produce the intended benefits in terms of brand recognition comparable that enjoyed under the Beeline brand.

The sale of VimpelCom, announced at the end of 2022, has still not been completed - the holding intends to close it during 2023. As of July 24, VEON had received permission from regulators in Russia, the UK and Bermuda and a license from the US Treasury's OFAC.

VEON's largest shareholder is LetterOne, part of Alfa Group of Mikhail Fridman and partners, with 47.9%. The company's free float on the Nasdaq is 43.8%, and another 8.3% is under the management of a Dutch stichting trust. VEON trades on Nasdaq and Euronext and is registered in the Netherlands.