USEM Telecom and MegaFon will receive 51% of the Uzbek operator

USEM Telecom and MegaFon will receive 51% of the Uzbek operator


Anna Savelieva | 02/10/2021

USEM Telecom and MegaFon will receive 51% of the Uzbek operator

The parties will create a joint company, as well as a new joint venture with partners from Uzbekistan.

The Government of Uzbekistan, through the Agency for State Assets Management (AUGA), will transfer to the Digital Holding JV a share in the amount of 100% of the authorized capital of the telecom operator Ucell.
In addition to them, the joint venture will include MegaFon and YueSem Telecom with Uzbek assets CRPT Turon and ICS Holding Uzbekistan.

To enter the JV USEM Telecom and MegaFon created the Digital Invest company, the shares in which were distributed by 50% on both sides. The share of Digital Invest in the new joint venture will be 51%, AUGA – 49%.

Ucell is an Uzbek mobile operator of GSM, UMTS, LTE and 5G standards, which has become a 100% state-owned company since December 5, 2018 “COSCOM”. As of February 2020, population coverage
is 97.6% (GSM); 72.9% (UMTS); 60.8% (LTE), and the number of subscribers reached 8 million.

The finalization of the transaction will take place during 2021. Digital Holding will focus on the formation of telecommunications infrastructure, as well as the implementation of technologies and systems in the field of information
security, data storage, labeling and control of the movement of certain types of goods.

As noted in MegaFon, over the past 10 years, the Uzbek market has shown more than threefold growth in cellular subscribers, but at the same time it is still far from saturation. Participants are not planning serious
structural changes within Ucell in 2021, “but rather, they will focus on finding synergies and implementing the best implemented practices in Ucell for the growth of its business.”

USM Telecom is a digital subdivision of the USM holding company, which controls 100% of the telecom operator MegaFon and the ICS Holding IT group. The main owners of YueSem Telecom are USM (80%
shares), Ivan Streshinsky (10%) and Anton Cherepennikov (10%).

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