AMSTERDAM - VEON (NASDAQ:VEON) Ltd. (NASDAQ:VEON, Euronext Amsterdam:VEON), a provider of digital connectivity and services, has agreed to sell its 50.1% indirect stake in Beeline Kyrgyzstan to CG Cell Technologies, owned by CG Corp Global. The transaction is consistent with VEON's strategy to streamline its operations and concentrate on larger markets where its DO1440 digital operator model can be scaled.
The deal values the Beeline Kyrgyzstan business at 3.4 times its 2023 EBITDA, pre-IFRS16 adjustments. Over the last two years, Beeline Kyrgyzstan has seen considerable growth under the leadership of Andrey Pyatakhin, with seven consecutive quarters of double-digit revenue increases and advancements in digital service offerings, including finance, entertainment, healthcare, and education.
Kaan Terzioglu, Group CEO of VEON, expressed pride in the team's achievements and confidence in passing the operation to CG Corp Global, which is expected to further the digital transformation in Kyrgyzstan.
CG Corp Global, a multinational conglomerate with diverse interests, has welcomed the acquisition as an opportunity to invest in the telecommunications market of Kyrgyzstan and pledged to maintain the high-quality connectivity and digital services customers expect.
VEON, headquartered in Amsterdam, operates in six countries and serves nearly 160 million customers.
The completion of VEON's stake sale in Beeline Kyrgyzstan to CG Cell Technologies is pending regulatory approvals.
This transaction is based on a press release statement from VEON Ltd.
InvestingPro Insights
VEON Ltd. has made a strategic move to divest its stake in Beeline Kyrgyzstan, focusing on optimizing its business model. In light of this development, certain InvestingPro metrics and tips provide a clearer picture of the company's financial health and market performance.
InvestingPro Data indicates that VEON's market capitalization stands at a modest 67.1 million USD, and the company has demonstrated a strong return over the last three months, with a 16.09% price total return. This performance aligns with the company's strategic efforts to concentrate on key markets. Additionally, VEON's revenue for the last twelve months as of Q4 2023 is reported at 3698 million USD, with an operating income margin of 24.91%. These figures suggest a robust operational efficiency that could support its scaling ambitions.
An InvestingPro Tip to note is that VEON's liquid assets exceed its short-term obligations, which may provide financial flexibility in executing its strategic initiatives. Moreover, analysts predict that VEON will be profitable this year, which could be an encouraging sign for potential investors.
For those seeking a deeper analysis of VEON's financials and market prospects, InvestingPro offers further insights. There are an additional 5 InvestingPro Tips available, which could guide investment decisions. Interested readers can explore these tips at https://www.investing.com/pro/VEON and use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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