VEON sells 50% stake in Wind Tre to CK Hutchison

VEON, a leading provider of connectivity and internet services has entered into an agreement with CK Hutchison Holdings for the sale of its 50% stake in Wind Tre.

The company has also submitted an offer to acquire the assets of Global Telecom Holding in Pakistan and Bangladesh.

The sale of VEON’s equity stake in Wind Tre will bring in proceeds of EUR 2.45 billion. A fraction of these proceeds will be used by VEON to acquire the GTH assets. The remainder will be used to reduce debt which, following completion of both transactions, will result in net pro-forma leverage ratio of approximately 1.8x, significantly below our target ratio of 2.0x.

These transactions represent two critical steps towards our ambition to simplify the Group’s structure and enhance shareholder value.

“Our goal is to drive greater value for our shareholders through a more focused and optimized portfolio” said Ursula Burns, Executive Chairman, VEON.

“To this end, the company has identified four immediate priorities: Simplifying the Group’s structure; increasing operational focus on emerging markets; strengthening the Group’s balance sheet; and supporting the company’s current dividend policy. Today’s transactions are important steps towards this goal,” commented Burns.

VEON expects to book a net gain of approximately $1.1 billion on completion and intends to use the proceeds to pay down debt and reduce its leverage ratio, supporting its current dividend policy, whilst pursuing other strategic initiatives.

On completion of the transaction, the Group’s pro-forma net leverage ratio is expected to improve by approximately 0.7x, bringing the pro-forma ratio down to approximately 1.7x.

The transaction is subject to EU merger control clearance and necessary Italian regulatory approvals and the completion of the transaction is expected to occur in Q3 or early Q4 2018.

VEON has submitted an offer to Global Telecom Holding (GTH) to acquire GTH’s businesses in Pakistan (Jazz and its associated operations) and Bangladesh (Banglalink) for a gross consideration of USD 2,550 million. These assets are already fully consolidated in VEON’s accounts. VEON will continue to hold its stake in Algeria (Djezzy) through GTH

The transaction is subject to approval of GTH shareholders at an extraordinary general meeting and certain regulatory approvals. Completion of the transaction is expected to occur in Q4 of 2018.


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