Telia Company sold its remaining 19 per cent share of Russian market leader MegaFon for RUB60.4 billion ($1 billion) to investment bank Gazprombank, as the operator group continued its retreat from Eurasia.
The Sweden-based company was still the Russian operator’s second largest shareholder after selling a 6 per cent stake in early October for RUB22.5 billion.
At the time, the deal was subject to a 90 day lock-up where Telia pledged not to sell further shares in MegaFon. However, a Telia representative said the original pledge was subject to a number of terms and only applied if the operator sold a proportion of the remaining stake.
Because it exited the market completely, the original promise did not apply the representative explained.
Discussing the sale, Telia CEO Johan Dennelind said: “Telia Company is one of the founders of MegaFon and we have since the inception actively contributed to its success of becoming a mobile and digital leader in Russia.”
“This divestment now puts an end to Telia Company’s ownership in MegaFon in accordance with our strategy to focus on the Nordics and Baltics.”
The sale is part of an ongoing strategy first announced in 2015 to exit markets deemed non-core. During the company’s third quarter earnings call in mid-October, Dennelind said Telia was making “step by step” progress towards its goal of becoming a “pure” Nordics and Baltics operator.
Telia’s exit from Russia follows a reduction of its Turkcell stake in September. Dennelind is also targeting a sale of its stake in Fintur Holdings, which controls interests in Azerbaijan, Georgia, Kazakhstan and Moldova.