DJ ROSTELECOM PJSC: Rostelecom acquires LUKOIL's telecommunication arm
ROSTELECOM PJSC (RKMD)
ROSTELECOM PJSC: Rostelecom acquires LUKOIL's telecommunication arm
12-Nov-2020 / 18:00 MSK
Dissemination of a Regulatory Announcement that contains inside information
according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
Rostelecom acquires LUKOIL's telecommunication arm
Moscow, Russia - November 12, 2020 - Rostelecom Group (MOEX: RTKM, RTKMP;
OTCQX: ROSYY), the largest integrated digital service provider in Russia,
today announces that it has signed a legally binding agreements to acquire
50.1% LUKOIL INFORM, the telecommunication business of LUKOIL - one of the
largest vertically integrated oil and gas companies in the world. Under the
agreements, at the time of signing, Rostelecom will acquire 50.1% shares in
the company, with call/put options to increase Rostelecom's participation to
100% in 2023. The total deal value will depend on LUKOIL-INFORM's financial
performance and will amount to no less than RUB 2 billion, including the
exercising the call/put options.
LUKOIL-INFORM operates the telecommunication infrastructure for oil and gas
exploration, production, processing, marketing and distribution across all
LUKOIL's branches in 53 regions in Russia. In line with the agreement,
LUKOIL will retain the existing contractual commitments for LUKOIL-INFORM
over the next five years. The deal will further solidify Rostelecom's B2B
offering through the formation of a competence center for digital
development in oil and gas sector. This in turn will open up further
opportunities to promote Rostelecom's comprehensive digital services across
LUKOIL's wider corporate footprint.
Anna Shumeiko, Senior Vice-President, the Chief of Staff of the President of
Rostelecom commented: "The acquisition of LUKOIL's telecommunications
business will strengthen our proposition for corporates. The wider synergy
effects of this fusion will yield new opportunities for collaboration with
the largest oil and gas major, including in the area of IoT technologies. We
have already started to explore new innovation projects and are looking
forward to learning from colleagues at LUKOIL to further strengthen our
digital skills that the oil and gas sector will benefit from".
Vladimir Kirienko, First Vice-President of Rostelecom commented: "The
ongoing digital transformation and the growing demand for cloud coming from
large industrial companies in the past few years, prompts them to hand over
telecommunications divisions to communication operators. This trend has
proved efficient both commercially and technologically, as companies don't
need to invest in setting up large scale IT infrastructures and can rely on
operators' ecosystems. The collaboration with LUKOIL will enable us to
optimise and expand the range of services for the entire group, and going
forward, build up our own competencies and enhance the digital offering for
continuous processing industries".
Further information is available at
https://www.company.rt.ru/en/ir/news_calendar/ [1].
* * *
PJSC Rostelecom [2] is the largest integrated digital services and products
provider, operating in all segments of the telecommunications market in
Russia. The Company serves millions of households, state and private
enterprises across the country.
Rostelecom is Russia's undisputed market leader, providing high-speed
Internet access and pay-TV. The total number of broadband users stands at
over 13.4 mln users, it has more than 10.7 mln pay-TV customers, over 5.9
mln of which are subscribed to Rostelecom's IPTV services. Tele2 Russia, a
Rostelecom subsidiary, is a major player in the mobile market with over 44
mln subscribers and the industry-leading NPS, a customer satisfaction
benchmark.
During the nine months of 2020, the Group generated RUB 383.9 bln of
revenues, RUB 149.6 bln of OIBDA (39% of revenue) and RUB 27.4 bln of net
income.
The Group is the leading provider of telecommunications services to
government bodies and corporates of all levels.
Rostelecom is a key strategic innovator that provides solutions in the
following fields: E-Government, cybersecurity, data-centres and cloud
computing, biometry, healthcare, education and housing & utility services.
The Group's stable financial position is confirmed by its credit ratings.
Rostelecom has been assigned 'BBB-' and 'BB+' international credit ratings
by Fitch Ratings and Standard & Poor's respectively, and AA(RU) by ACRA.
* * *
Certain statements in this press release are forward-looking statements
within the meaning of the U.S. federal securities laws and intended to be
covered by the safe harbours created thereby.
Those forward-looking statements include, but are not limited to:
? Assessment of PAO Rostelecom's (the Company) future operating and
financial results as well as forecasts of the present value of future cash
flows and related factors;
? The Company's plans to take ownership stakes in other organisations;
? the Company's anticipated capital expenditures and plans to construct
and modernize its network;
? the Company's expectations as to the growth in demand for its services,
plans relating to the expansion of the range of its services and their
pricing;
? the Company's plans with respect to improving its corporate governance
practices;
? the Company's expectations as to its position in the telecommunications
market and forecasts on the development of the market segments within
which the Company operates;
? economic outlook and industry trends;
? the Company's expectations as to the regulation of the Russian
telecommunications industry and assessment of impact of regulatory
initiatives on the Company's activity;
? other statements regarding matters that are not historical facts.
Such forward-looking statements are subject to risks, uncertainties and
other factors, which could cause actual results to differ materially from
those expressed or implied by these forward-looking statements. These risks,
uncertainties and other factors include:
? risks relating to changes in political, economic and social conditions
in Russia as well as changes in global economic conditions;
? risks relating to Russian legislation, regulation and taxation,
including laws, regulations, decrees and decisions governing the Russian
telecommunications industry, securities industry as well as currency and
exchange controls relating to Russian entities and their official
interpretation by regulatory bodies;
? risks relating to the Company, including the achievement of the
anticipated results, levels of profitability and growth, ability to create
and meet demand for the Company's services including their promotions, and
the ability of the Company to remain competitive in a liberalized
telecommunications market;
? technological risks associated with the functioning and development of
the telecommunications infrastructure, technological innovations as well
as the convergence of technologies;
? other risks and uncertainties. For a more detailed discussion of these
and other factors, see the Company's Annual Report and the Company's other
public filings.
Many of these factors are beyond the Company's ability to control or
predict. Given these and other uncertainties, readers are cautioned not to
place undue reliance on any of the forward-looking statements contained
herein or otherwise. The Company does not undertake any obligation to
release publicly any revisions to these forward-looking statements (which
are made as of the date hereof) to reflect events or circumstances upon the
annual report publication or to reflect the occurrence of unanticipated
events, except as may be required under applicable laws.
ISIN: US7785291078
Category Code: MSCM
TIDM: RKMD
LEI Code: 2534001D752JPNM0H170
Sequence No.: 87795
EQS News ID: 1147829
End of Announcement EQS News Service
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2: https://eqs-cockpit.com/cgi-bin/fncls.ssp?fn=redirect&url=2191e3bd109978bbadf8617de6d24ca7&application_id=1147829&site_id=vwd&application_name=news
(END) Dow Jones Newswires
November 12, 2020 10:01 ET (15:01 GMT)
