By buying Coscom, MegaFon will debut on the merger/takeover market of CIS.
Photo: Sergey Mikheev
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MegaFon Builds Up Foreign Ties
Russia’s third biggest mobile operator, MegaFon is negotiating the purchase of Uzbek Coscom, which is also the third in its country. The deal will be MegaFon’s debut on the merger/takeover market outside Russia.
MegaFon is in talks with the U.S. MCT Corp. to buy out 85 percent in Uzbek Coscom, said sources close to Russia’s operator. MegaFon confirmed its interest in Coscom yesterday, but declined to elaborate, and MCT couldn’t be reached for comment. Coscom costs roughly $180 million to $200 million now, the players on Russia’s cellular market speculate.
Coscom (a bit more than 300,000 subscribers) was set up in 1996. MCT Corp. holds 85 percent, while individuals and top managers own the remainder. The GSM 900/1800 net of Coscom covers all big cities of Uzbekistan. The annual revenues are estimated at around $40 million, according to ComNews Research.
For MegaFon, the purchase of Coscom will be a debut on the CIS market of merger and takeover. In the last four years, MegaFon’s bigger rivals, MTS and VimpelCom, have been aggressively expanding in the states of the former Soviet Union, while MegaFon has had a sole foreign asset so far. It is Tadjik TT-Mobile, which the operator created from scratch in cooperation with TadjikTelecom in 2001.
“MegaFon approached the market of Russia later than MTS and VimpelCom. For a long time, all efforts were targeted at securing a footing in Russia,” said Yevgeny Solomatin, the development director at Cominfo Consulting. “Now it has to approach the foreign markets behind the time. The same as competitors, it doesn’t have a raft of chances to attract new subscribers with cellular penetration in Russia at 70 percent to 75 percent.”
www.kommersant.com
All the Article in Russian as of Sep. 07, 2006
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