Interview With Altimo CEO, Alexey Reznikovich, Published on Dow Jones

13/02/2008 19:24


PR Newswire

BARCELONA, February 13 /PRNewswire/ --

- The following article was published by Dow Jones Newswires on 12 February 2008. Please credit Dow Jones Newswires if using any part of this article. (C) 2008 Dow Jones & Company, Inc. all rights reserved worldwide.


- The following story is being retransmitted with permission by Dow Jones, for Altimo

Russian investment company Altimo won't stand in the way if mobile operator Megafon decides to launch an initial public offering in 2009, said Altimo Chief Executive Alexey Reznikovich.

"An IPO would help make the company more transparent, determine fair value and provide liquidity for shareholders," said Reznikovich in a recent interview with Dow Jones Newswires. Megafon is Russia's third-largest mobile operator by customers.

Last year, Altimo - Alfa Group's telecommunications investment business - resolved a four-year legal feud with Bermuda-based investment fund IPOC over which of the two companies owned a 25% stake in Megafon. Altimo won.

Altimo's backing of a potential stock flotation removes one of the last hurdles for Megafon's listing, a move that is likely to happen in 2009. Sweden's TeliaSonera ASA (TLSN.SK) is one of the other main shareholders in Megafon.

Earlier this week, Megafon reported a 47% rise in 2007 revenues to US$5.5 billion, as it pushed its customer numbers past 36 million. An IPO of Megafon could see Altimo's asset base grow further.

Altimo's investment in fast-growing markets, such as Russia and the Ukraine, has helped boost the investment vehicle's asset value to US$30 billion from US$5 billion in the last six years, said Reznikovich.

The company is now eyeing further stakes in operators based in fast-growing markets, such as Vietnam, Indonesia and Burma.

However, in Vietnam, Altimo plans to expand through OAO Vimpel Communications (VIP), Russia's second-largest mobile and fixed-line telephony operator, which it co-owns with Telenor ASA (TEL.OS).

"At the moment Vimpelcom is having a major effort in Vietnam and has signed an agreement with the ministry of security," he said. But there is still uncertainty over how the Vietnamese government will liberalize its telecommunications market, he said.

"However, Indonesia is a higher priority country for us," said Reznikovich. "It's a large country with more than 250 million people and mobile phone penetration is low."

In the past Altimo has also floated the idea of swapping its disparate assets in countries such as Russia, the Ukraine and Turkey "for a smaller stake in a larger pie" of a Western telecommunications operator.

However, current market conditions, as well as potential political and media opposition in the West regarding a partnership with the most likely candidates, Scandinavia's Telenor or TeliaSonera, are likely to prevent any such moves in the near term, said Reznikovich.

"If we are to combine our assets with someone else it needs to be a company with reasonable growth," said Reznikovich. "We don't want to exchange our growth for their stagnation."

Alfa, Altimo's parent company, is controlled by Russian oligarch Mikhail Fridman. Altimo itself boasts an advisory board including former U.K. foreign secretary Douglas Hurd, former Telefon AB LM Ericsson (ERIC) chief executive Kurt Hellstrom and former Vodafone Group PLC (VOD) deputy chief executive Julian Horn-Smith.

Altimo executives, who are at Barcelona's Mobile World Congress this week, will be providing partners with an update of their Altimo mobile development index, which monitors the relative attractiveness of mobile phone markets from an investor's point of view.

Company Web site: http://www.altimo.org

Media contact: Alexei Orlov, Altimo, +7-495-981-4488 ext253; mob: +7-903-549-9989.