Mobilink Slips Further into Telenor’s Hands
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Norwegian telecom giant Telenor has further raised its stakes in Vimpelcom after it struck a $715-million deal with JP Morgan Securities last week, giving the group even more financial and voting rights in Vimpelcom.
After buying 65 million common shares from the bank, Telenor now owns 35.66 percent of Vimpelcom up from 31.67 percent, and 39.51 percent of the votes up from 36.36 percent before.
Telenor took back control of Vimpelcom from Russian oligarch Mikhail Fridman’s Alfa Group after buying 234 million shares, boosting its ownership to 31 percent from just 25 percent.
It maybe recalled that Vimpelcom, through a deal finalized last year, holds 51.7 percent stakes in Orascom Telecom, the parent group of Mobilink.
With 35.66 percent stakes in Vimpelcom, Telenor group holds 18.44 percent economic rights in Orascom, or in Mobilink subsequently, a fully owned subsidiary of Orascom Telecom.
This proposition translates into a situation where Telenor group has operations in Pakistan through Telenor Pakistan in addition to Mobilink in which it holds 18.44 percent economic stakes.
In simpler words, 18.44 percent of profits from Mobilink goes into Telenor’s pockets, in addition to 20.43 percent voting rights in the firm through its holding.
The situation can concern the competition operators in Pakistan or the competition commission of Pakistan. Even PTA would be worried of this outcome as Telenor’s financial and voting ownership in Mobilink can restrict both firms from bidding in upcoming 3G license auction.
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