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2019-05-23 08:30:00

Tele2 AB: Tele2 has agreed with Kazakhtelecom on the terms of its exit from Kazakhstan

Stockholm - Tele2 AB ("Tele2") (Nasdaq Stockholm: TEL2 A and TEL2 B) has agreed with Kazakhtelecom on the price for its equity share in the joint venture between Tele2 and Kazakhtelecom ("the JV"). The net proceeds to Tele2, after deducting the existing earn-out liability, will be USD 169 million (approximately SEK 1.6 billion). In addition Tele2 will receive full repayment of its shareholder loan amounting to KZT 80 billion (approximately SEK 2.1 billion). The transaction is expected to close at the end of June.


- Tele2 has built a successful business in Kazakhstan and rolled out a national network for high-quality voice and data. The JV has dramatically increased its customer base, revenue, market share and profitability. Mobile data consumption per customer has doubled since the creation of the JV and is more than a hundred times higher today compared to when Tele2 entered the country. Tele2 has enabled a more connected life and I am proud of the legacy we leave behind in Kazakhstan", says Anders Nilsson, President and CEO, Tele2.

Key financials
On 28 December 2018, Tele2 gave its notice to exercise put option in the JV, in which Tele2 owns 49 percent of the economic interest and 51 percent of the votes. The new agreement values the JV at an enterprise value of USD 800 million, corresponding to a multiple of 7.3 times its underlying EBITDA 2018. Rothschild&Co acted as lead financial advisor and Goldman Sachs International provided additional financial advice to Tele2.

The net proceeds to Tele2, after deducting the earn-out liability to Kauz, the legal successor and parent company of AsiaNet, will be USD 169 million (approximately SEK 1.6 billion). Tele2 will also receive full repayment of its shareholder loan, amounting to KZT 80 billion (approximately SEK 2.1 billion). The transaction is expected to close at the end of June.

The expected financial consideration to Tele2 will reflect a fully diluted economic equity interest of 31 percent, taking into account Kauz's 18 percent earn-out, as previously communicated.

Extraordinary shareholder remuneration
As previously announced, Tele2's Board of Directors intends to remunerate shareholders with the net proceeds received from the sales of assets in Kazakhstan and the Netherlands while maintaining the financial leverage target range of 2.5-3.0x. The form and timing of distribution of the proceeds will be announced at a later date.

Exit report on ethics and compliance
Tele2 is committed to doing business ethically and compliant, and to providing transparency in its sustainability efforts. As such, Tele2 has issued reports on its compliance efforts in Kazakhstan annually since entering the country. Today Tele2 publishes the report "Tele2 Kazakhstan - Exit Report on Ethics and Compliance", which covers all these efforts during the time of the JV in one comprehensive report. The report is available at the Policies and Reports page under the Sustainability section of www.tele2.com.
For more information, please contact:
Joel Ibson, Head of Corporate Communications, Phone: +46 766 26 44 00
Erik Strandin Pers, Head of Investor Relations, Phone: +46 733 41 41 88
TELE2'S MISSION IS TO FEARLESSLY LIBERATE PEOPLE TO LIVE A MORE CONNECTED LIFE. We constantly strive to be the truly integrated challenger - providing speed, data and video content, no matter where or when. Ever since Tele2 was founded in 1993, we have continued to challenge prevailing norms and dusty monopolies. Today, our award winning networks enable mobile and fixed connectivity, telephony, data network services, TV, streaming and global IoT solutions for millions of customers. We drive growth through customer satisfaction and smart combined offerings. Tele2 has been listed on Nasdaq Stockholm since 1996. In 2018, Tele2 generated revenue of SEK 30 billion and reported an adjusted EBITDA of SEK 9 billion. For latest news and definitions of measures, please see our homepage www.tele2.com




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