25 Jan 2024 11:56

New MTS Armenia owner to give 20% of communications operator's shares to state

YEREVAN. Jan 25 (Interfax) - The new owner of MTS Armenia CJSC, Cyprus-based Fedilco Group Limited, intends to transfer 20% of its shares to the Republic of Armenia, the MTS Armenia press service reported.

"Given the strategic importance of MTS Armenia to Armenia, Fedilco Group Limited intends to transfer 20% of its shares to the republic free of charge," the statement says.

The owners of Cyprus-registered Fedilco Group Limited are European and Asian investors, and the ultimate beneficiaries are Zhe Zhang and Konstantin Sokolov, "professional investors with extensive experience in the fields of telecommunications, finance, energy and asset management," the statement says.

As reported, on Wednesday, MTS announced the sale of its business in Armenia to the Cypriot group.

The company's press release said that the deal was for the sale of 100% of the shares of MTS Armenia CJSC, as well as its 100% subsidiary, the MobiDram payment system.

The company has received the necessary corporate approvals and permits from Armenian regulators the State Commission for the Protection of Economic Competition and the Public Services Regulatory Commission.

In mid-November, the Public Services Regulatory Commission approved an application for the sale of the business in Armenia to the Cypriot Fedilco Group Limited. It was reported that, following the deal, MTS Armenia would no longer be a member of the MTS group.

This is the second attempt by MTS to sell its business in Armenia. In the spring of 2023, the local regulator was already considering a similar application for a deal, but rejected it without explanation.

"The transaction is part of the continuation of the transformation strategy of MTS group, aimed at the further development of its ecosystem and core business in Russia. If there are favorable offers, MTS will sell non-core assets or assets with limited potential for growth in value, and direct the proceeds to the development of its key ecosystem business in Russia," the MTS press service told Interfax.