Telenor Group of Norway has announced the sale of 4.0% of the outstanding common shares in VEON (formerly VimpelCom) as it continues its previously announced strategy of exiting the Amsterdam-headquartered, Russian-backed multinational telecoms group. The offering of 70 million common shares and American Depositary Shares (ADSs) is priced at a public offering price of USD3.75 per ADS/share, resulting in net proceeds to Telenor of USD259 million. The offer will leave Telenor with approximately 346.7 million VEON ADSs (19.7% of VEON’s total outstanding common shares), including the VEON ADSs that are underlying Telenor’s USD1 billion, three-year exchangeable bond due 2019. The offering is expected to close on or about 12 April 2017.
Following the transaction, VEON will no longer be treated as an associated company in Telenor’s financial reporting, whilst Telenor added in a statement: ‘all of the previously recognised currency translation differences, amounting to an accounting loss of NOK7.5 billion [USD871 million], including tax effects related to the hedging instruments, will be reclassified to the income statement. The effects of reclassification do not impact the total equity of Telenor. The effect will be recognised in the second quarter 2017.’