Vimpelcom buys URS; sticks two fingers up to Telenor

11 Nov 2005

Russian cellco Vimpelcom has finally sealed a deal for Ukrainian RadioSystems (URS), despite strong opposition from its own shareholder Telenor. Vimpelcom will pay USD231.3 million for URS, including the purchase price of USD206.5 million, plus expenditures totalling USD24.8 million and the assuming of debt worth approximately USD23.5 million.

Telenor and fellow Vimpelcom shareholder Alfa Group have been at loggerheads ever since the latter tried to push through a purchase of URS last year, claiming that the cellco possesses plenty of growth potential in a rapidly expanding market. But Telenor is fiercely opposed to the purchase and the pair have been embroiled in a vicious battle for control of Vimpelcom since the early part of this year. Telenor and Alfa already share ownership of one of the Ukraine’s biggest mobile operators, Kyivstar, and the Norwegian company said a potentially costly raid for the far smaller URS had ‘no business merit’; the cellco, which trades under the brand name WellCOM, has a market share of less than 0.5%. Telenor has yet to comment on the completed deal.