It became known last Friday that "Vympelcom" has found a path to enter the Ukrainian market, reports "Kommersant".
According to the general director of "Vympelcom," Alexander Izosimov, the Russian cellular operator is looking for a private investment fund to buy "Ukrainian Radio Systems."
The fund will buy URS specifically for "Vympelcom," issuing a long-term option to the operator. The money for building and developing the URS network, according to Mr. Izosimov, will be provided by equipment manufacturers in the form of commodity credits.
"Under this scheme, the 'Vympelcom' network will start operating in Ukraine this year," the newspaper writes.
According to analysts' estimates, the volume of investment in the development of the URS network will amount to $300-400 million over two to three years. "Vympelcom" management states that it can delegate to URS the right to use the "Beeline" brand.
As is known, the appearance of "Beeline" in Ukraine was hindered by a conflict between "Vympelcom" shareholders – "Alfa Group" and Telenor. "Alfa" advocated buying Ukrainian Radio Systems, Telenor was against it, since this Norwegian company owns a controlling stake in another operator – "Kyivstar" (56.5%). "Alfa" holds 43.5% in "Kyivstar."
Closed Joint-Stock Company "Ukrainian Radio Systems," which is linked to the "Privat" group, holds a license to provide cellular communication services in GSM 900 and GSM 1800 standards throughout the entire territory of Ukraine. The company has been operating since October 1998 under the trademarks Wellcom and "Mobi."
According to the State Department of Communications of Ukraine, the number of URS subscribers as of May 1, 2005, is 51.2 thousand – 0.31% of the market.