DUSHANBE, APRIL 26 2017 (The Conway Bulletin) — Telia, the Swedish telecoms company, sold its 60% stake in Tajik mobile operator Tcell to the Aga Khan for $27.7m, the first in a series of sales which it plans to extract itself from Central Asia and the South Caucasus.
The final sale price was lower than the $39 agreed in September but for Telia it will be a relief to be rid of a company that it had come to see as a burden.
Last month it accused the Tajik government of effectively blocking the deal after it failed to meet a deadline to give its approval and in January, too, Telia said Tajikistan’s tax authorities had slapped a bogus tax claim against Tcell.
But the main relief for Telia will be in agreeing its first deal to sell out of one of the five companies it part- owns in the region after declaring in February 2016 that the reputational and corruption risk of business in Central Asia and the South Caucasus was too high.
Telia CEO Johan Dennelind underlined this point in a statement. “By divesting Tcell we have now taken a second step in our strategy to leave region Eurasia and we maintain the ambition to complete our exit in 2017,” he said.
Tcell is the biggest mobile network in Tajikistan. The Aga Khan, a major investor in Tajikistan, already owned 40% of Tcell.
Telia is the subject of one of the biggest bribery cases in Western corporate history after admitting that its executives paid hundreds of millions of dollars in 2007 to the daughter of then-president Islam Karimov for access to Uzbekistan’s mobile market.
Swedish media uncovered the bribe, and others paid by Russia’s Vimpelcom, in a series of investigations from 2012, causing major reputational damage to Telia’s brand.
The US and Dutch authorities prosecuting Telia had agreed a $1.45b fine for corruption but Jonas Bengtsson, the company’s General Counsel, also said on April 26 that this was likely to be cut to $1b.
“We have made progress and as a result of our discussions and in light of recent developments to date, we have adjusted our estimate of the most likely outcome and we are therefore changing our provision to reflect the best estimate,” he said.
“The new provision amounts to $1b.”
Telia’s other companies in the region are Ucell in Uzbekistan, Kcell in Kazakhstan, Azercell in Azerbaijan and Geocell in Georgia. It owns these stakes with Turkey’s Turkcell through the Netherlands-registered holding company Fintur.
Telia is in talks to sell its 58.5% stake in Fintur to Turkcell.
ENDS
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(News report from Issue No. 326, published on April 28 2017)
