This would be the first 100% Ukrainian outfit to float in US, but no mention of how much of the operator will be floated nor how much the actors expect to raise
Operator group VEON and Cohen Circle Acquisition Corp, a special purpose acquisition company have signed a letter of intent. They plan to enter into “a business combination with the aim of indirectly listing Kyivstar…on the Nasdaq Stock Market” in the US. Kyivstar is VEON’s telecoms operator in Ukraine.
The operator has links to two oligarchs sanctioned by the European Union, according to the Financial Times [subscription needed], and could only proceed once corporate rights in the subsidiary were unfrozen by authorities in Kyiv.
Ukraine is looking to attract inward investment: last September, the French telecoms entrepreneur, billionaire and founder of the Iliad group, Xavier Niel bought Lifecell, for more than $500 million. Lifecell is Ukraine’s third-largest mobile provider.
Assuming the transaction completes, Kyivstar will be the first purely Ukrainian firm to be publicly listed on a U.S. stock exchange. They hope to attract US and other international investors to participate more directly in Kyivstar’s growth and the broader recovery of the Ukrainian economy. No details have been given about how much of the operator will be floated nor expected values.
Kyivstar is Ukraine’s largest mobile and fixed-line business, serving nearly 24 million customers. It also operates the streaming platform, Kyivstar TV. It eported earnings before interest, taxes, depreciation and amortisation of $541 million in 2023.
Its portfolio of digital services includes the digital healthcare platform Helsi. which has a registered user base of 28 million. The operator offers B2B services, including cloud, cybersecurity and AI solutions. It says it is “a growing player in the software development landscape of Ukraine via Kyivstar Tech, and a preferred partner for international technology companies”.
It recently signed a “groundbreaking” agreement with Starlink to bring direct-to-cell satellite connectivity to Ukraine to enhance the resilience of communication.
Augie K Fabela II, Chairman and Founder of VEON, said, “We are proud to be opening American and global markets for Ukraine with Kyivstar’s benchmark Nasdaq listing. As Ukraine’s largest private investor, this milestone amplifies our Invest in Ukraine NOW! campaign, showcasing the country’s growth potential and offering American investors direct access to its future economic opportunities.”
“The agreement that we have reached with Cohen Circle is a significant step in VEON’s ambition of crystallising value for our investors, including through the listings of our key assets where relevant,” added Kaan Terzioglu, VEON Group CEO. VEON was lambasted by Shah Capital, a long-term investor in the group, last October for a decade of poor returns and demanded change, including monetisation of assets.
Terzioglu continued, “It also underscores our commitment to rebuilding Ukraine through investments. We are excited to see investor interest in Kyivstar’s growth story and the appreciation of Ukraine’s potential. We are determined to work diligently towards the successful completion of this process, which will make Kyivstar a unique US-listed opportunity for international investors while also highlighting the overall investment case for Ukraine.”
In December, VEON relocated its HQ from Amsterdam in the Netherlands to Dubai to be closer to its markets. It also consolidated its share trading on the Nasdaq in November, removing common shares from Euronext Amsterdam. The group operates in Pakistan, Bangladesh, Kazakhstan, Uzbekistan and Kyrgyzstan as well as Ukraine.
VEON’s board of directors includes Mike Pompeo, the former US Secretary of State, and Sir Brandon Lewis, a former UK government minister. Veon has already pledged to invest $1 billion between 2023 and 2027 to rebuild Ukraine’s war-damaged digital infrastructure. It quit Russia, selling its operations and assets in the country in 2023.