KIEV, Ukraine-Two leading Ukrainian carriers continue to expand in the country, while some outsiders had to quit the market, opening a way for acquisitions and takeovers.
The Ukrainian Mobile Communications (UMC), which has close to 1.8 million subscribers, said it will invest US$400 million into nationwide network development during the coming four years. Director General Erik Franke said the company had invested US$400 million in 10 years of its existence and will accelerate the pace after Russia’s biggest carrier Mobile TeleSystems (MTS) acquired its controlling interest.
Kyivstar, with more than 1.8 million subscribers, placed bonds worth an additional US$60 million in March underwritten by Dresdner Bank. The demand exceeded the supply by US$50 million, which allowed the carrier to decrease the annual yield to 10.96 percent compared with 12.75 percent during the first placement worth US$100 million last November.
In April, Kyivstar plans to borrow another US$11.06 million in the domestic market. The yield will range from 13.5 percent for dollar-nominated corporate bonds to 17 percent for hrivna-nominated bonds. The carrier initially scheduled the issue for February, but postponed it for two months because of delays in agreements with major vendors.
In the meantime, outsider Novacell, an affiliate of Turkish Turkcell, which planned to develop a GSM network in Ukraine, announced the liquidation of the company, although some time ago it planned to issue additional stock. No reasons for the liquidation were cited.
The Astelit carrier, which has a GSM 1800 MHz license but never launched a network, is to be bought by Digital Cellular Communications of Ukraine (DCC), which currently operates DAMPS technology, but has no license for mobile communications. The Ukrainian Anti-Monopoly Committee has already allowed the purchase of Astelit’s controlling stake.
Ukrainian media also rumored DCC is negotiating either a merger or a takeover with Ukrainian RadioSystems (Wellcom). Both operators refused comment.
With all the changes, the Ukrainian market has reduced to five mobile carriers-Kyivstar, UMC, Wellcom, DCC and Golden Telecom.
Ukrainian media reported late last year that Golden Telecom was planning to sell its mobile unit to Kyivstar and focus on fixed-line communications. However, the carrier hurried to reject the claims, saying it will improve the existing mobile services in Kiev and Odessa where it has 42,000 clients, but will refrain from further expansion in the country.
