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Vimpelcom eyes Italy’s Wind, Egypt’s Orascom-paper

Deal could be worth $6.5 bln.

August 12, 2010 10:51 by

Telecoms group Vimpelcom Ltd may buy Italy’s No.3 mobile operator Wind and 51 percent of Egypt’s Orascom Telecom from tycoon Naguib Sawiris, Kommersant reported on Thursday citing an unnamed source.

The acquisition would mark a major expansion for the newly created entity, formed earlier this year through a merger of Russia’s number two mobile operator Vimpelcom with Ukraine’s Kyivstar.

“The deals suggest a near-doubling of Vimpelcom’s scale at the revenue level and turning it into a truly international player with diversified geographical exposure,” UniCredit Securities analysts wrote in a note.

“In terms of strategy, we welcome the deal and expect the market to cheer it as well; however, the price tag is a crucial factor,” they said.

Kommersant quoted an unnamed source familiar with Vimpelcom’s plans as saying Vimpelcom could pay for the deal with cash and shares. Sawiris and his partners may get around 20-23 percent of voting shares in Vimpelcom Ltd. which currently has a market value of $22.6 billion.

The deal, worth an estimated $6.5 billion without debt, may be closed soon, the business daily wrote citing another unspecified source.

The creation of Vimpelcom Ltd finally resolved one of Russia’s longest and most bitter corporate wars — between oligarch Mikhail Fridman’s Alfa-Group and Norway’s Telenor.

Telenor and Alfa Group would see their stakes in Vimpelcom Ltd decrease to 27 percent and 35 percent of voting shares respectively, from 36.03 percent and 44.65 percent, if the deal goes through, Kommersant wrote.

A spokeswoman from Vimpelcom declined to comment to Reuters, and Telenor spokesman Dag Melgaard said he would not comment on rumours about potential transactions.

Altimo, the telecoms arm of Alfa-Group, was not immediately available for comment. (Reporting by Maria Kiselyova, Additional reporting by Richard Solem in Oslo, Editing by John Bowker and Erica Billingham)

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