“Rostelecom” will increase its presence in Tele2 in Russia

Photo: Natalia Seliverstova / RIA Novosti

“Rostelecom” plans to increase its presence in the joint venture “T2 RTK Holding” that in Russia Telecom services under the Tele2 brand. The question is how personnel changes, and a possible change in the structure of owners

The President of Rostelecom Mikhail Oseevsky, who led the company last week, said that the company is “considering whether to receive control in “T2 RTK Holding” (provides communication services under the Tele2 brand), the correspondent of RBC from the press conference on Monday, March 6. “We need effective cooperation with Tele2. We now analyze whether it is possible to do it under the current ownership structure or need to change something”, — he said. Companies have already started joint procurement of equipment that allows you to get discounts from manufacturers for volume.

Also the aim is for the sale of convergent packages (packages for subscribers that would include services and fixed-line telephony, and mobile), said the representative of “Rostelecom”. At the same time the Governor announced that a full redemption in Tele2 package “was never discussed”.

Governor did not specify when it can be decided whether “Rostelecom” to increase the proportion of “T2 RTC Holding”. Only said that in the first phase, the operator intends to increase its presence in the Board of Directors of the company — it will include himself, Governor, and Vice-President of “Rostelecom” Vladimir Kirienko. “It is not about quantitative increase, but about quality,” he said. Now in Board of Directors “T2 RTK Holding” representatives “Rostelecom” hold four of nine seats.

Mr. Oseevskiy was appointed head of “Rostelecom” last week. In this position, he was replaced by Sergey Kalugin, whose contract has been prematurely terminated (ended in March 2018). As one of the reasons for the change of the President of the company, the source of RBC called negative attitude Kalugin to increase the share of “Rostelecom” in “T2 RTK Holding”.

“T2 RTC holding” was created in 2014 through the merger of the mobile assets of Rostelecom and Tele2 Russia. Rostelecom received 45% of the company, the rest divided VTB structures of Bank Rossiya and Alexei Mordashov (the proportion between the partners is not disclosed). In early 2013, VTB bought 100% of Tele2 Russia from Swedish Tele2 AB, and in the fall sold 50% in the operator structures of Bank Rossiya and Alexei Mordashov.

In the financial statements of VTB says that the revenues “T2 RTK Holding” by the end of 2016 according to international financial reporting standards grew by 12% compared with the figure of 2015, to 105.9 billion rubles. the company’s Net loss amounted to 15.6 billion rubles. instead of the 7.6 billion rubles in 2015. Himself “T2 RTK holding” ceased to disclose the financial and operational results in mid-2016, however, Tatarstan, the company will consider the possibility of publishing separate figures for year-end 2017.

Slim optimism

Monday “Rostelecom” also published statements for 2016. Revenue grew by 0.03% in comparison with the year 2015 to 297,4 bln RUB, OIBDA decreased 4%, the margin on it is 32.5% instead of 33.9 per cent a year ago. Net profit “Rostelecom” has decreased by 14.9% to 12.2 billion rubles.

Earlier “Rostelecom” expected that by the end of 2016 the growth rate of the company’s revenues will amount to 1% compared to 2015, and OIBDA will decrease by 4-6%. This forecast Rostelecom was announced in November of 2016, publishing the results of the third quarter. As explained by the financial Director “Rostelecom” Kai-Uwe Mehlhorn, this was affected by the shortfall of funds for project eliminate “digital inequality”. It was assumed that during the ten years from 2014, when the project began, “Rostelecom” will receive a total of 168 billion from the universal service Fund is a special Fund to which every operator contributes to 1.2% of revenue from telecommunications services. In 2014, disbursements amounted to 10.7 billion rubles, in 2015 — RUB 13.3 billion. However, in 2016 in the Russian budget for these purposes instead of previously planned RUR 14.8 bln. planned all of 7.9 billion rubles.

In the words of Kai-Uwe Mehlhorn, “Rostelecom” looks with the “subtle optimism” for 2017. According to his forecast, the company’s revenue could grow by 1%, and OIBDA up 1%. CAPEX Rostelecom will amount to approximately 18.5%, which is comparable to the level of 2016.

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