Telecom operator VimpelCom may sell its fixed-line retail broadband business in Russia to focus on higher-margin mobile business, two sources said Wednesday.
A sale of the assets — with an estimated value of $1 billion according to Vedomosti — would leave VimpelCom's Russian unit with a mobile business and potentially fixed-line corporate clients.
VimpelCom was focused on Russia and former Soviet republics until 2011 when it acquired Egyptian group Orascom Telecom and Italian firm Wind.
It said in a recent strategy update that it wanted to be a mobile-focused company with a selective presence in fixed-line, aiming at improving operating cash flows.
One source close to VimpelCom said the New York-listed company was considering a sale of the assets and had held talks with possible buyers. A source with a rival operator said VimpelCom was seeking buyers for the operation.
VimpelCom declined to comment.
Vedomosti reported that VimpelCom values its Russian residential fixed-line broadband business at $1 billion, adding that the company wanted to keep corporate fixed-line broadband clients.
"As a strategic move, this could be linked to the company's intention to focus more on profitable mobile business," one of the sources said.
VimpelCom generated $23.5 billion in 2011 revenue with $9 billion coming from Russia, the bulk of which was mobile.
Related articles:
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.
