Presentation on theme: "ALTIMO General Presentation 2010-4Q This document has been prepared for informational purposes only. It is not intended to or shall be deemed to be construed."— Presentation transcript:
ALTIMO General Presentation Q This document has been prepared for informational purposes only. It is not intended to or shall be deemed to be construed to constitute an offer or agreement or to represent any binding legal obligation on the part of Altimo. Altimo hereby waves any liability in connection therewith. This document contains forward-looking statements of financial and operational performance of certain companies. The actual outcome may differ materially from these statements as a result of unforeseen developments. Altimo disclaims any obligation to make corrections to reflect future events or developments.
2 Altimo is the Telecom Investment arm of Alfa Group Alfa Bank Wide range of financial services, including corporate banking, retail banking, investment banking, trade finance and asset management TNK-BP Russia’s third largest vertically integrated oil company in terms of production A1 Group Large-scale proprietary and for- client investment in Russia, the CIS and other emerging markets X5 Retail Group N.V. LSE-listed X5 Retail Group N.V. is the largest food retail company in Russia in terms of sales. X5 Retail Group N.V. includes the supermarket chains Pyaterochka and Perekrestok. The company uses a multi-formatted strategy to develop three formats simultaneously: soft discounters, supermarkets and hypermarkets. Alfa Strakhovanie Insurance Group One of the largest non- obligatory insurance companies in Russia Russian Technologies Investment and development of promising Russian commercial and consumer technologies Alfa Asset Management The Group’s asset management arm whose clients include Russian as well as international institutional and private clients Alfa Capital Partners The Group’s private equity and real estate investment group Altimo Telecom Investment arm of Alfa CTC TV The first private TV channel in Russia
3 Altimo overview Fixed-Mobile Russia Ukraine Kazakhstan Uzbekistan Tajikistan Georgia Armenia Vietnam Cambodia Mobile Russia Tajikistan Mobile Turkey Ukraine Belarus 44,7% 1 25,1% 13,22% Azerbaijan Kazakhstan Georgia Moldova 41,45% Altimo is the leading international private equity investor in emerging telecoms markets across Eurasia, that was established to hold the telecoms investments of the Alfa Group, Russia’s largest and most respected privately-owned business consortium. Its investment portfolio holds assets in Russia, the CIS, Turkey and other emerging markets of Europe and Asia. The value of Altimo’s investment portfolio exceeds $14bn. The companies in which Altimo is invested have a footprint which covers a total population of 350 million people with over 210 million subscribers. 1 Voting stake, economic stake equals 39.2%.
44 Vimpelcom Ltd. The Company significantly improved financial results, raising substantially net profit level: June 10 th. The Company announced changes to the reporting structure of the Company. The reporting structure will be divided into four business units – Russia, Ukraine, CIS and International – that will report to the Company’s headquarters in Amsterdam. August 9 th. The company announced that it has completed the acquisition of all shares of OJSC "Vimpel- Communications”, including those represented by American Depositary Shares, from its remaining minority shareholders by way of a mandatory squeeze-out process and became 100% owner of OJSC VimpelCom. October 4 th. Signed an agreement to combine VimpelCom and Weather to create a new global telecom group, the world’s fifth largest mobile telecommunications carrier by subscribers with pro forma net operating revenues of US$21.5 billion and pro forma EBITDA of US$9.5 billion (for the year ended December 31 st, 2009). October 19 th. The Ukrainian Anti-Monopoly Committee confirmed its prior approval of the transaction to combine OJSC VimpelCom and Kyivstar GSM under VimpelCom Ltd. October 20 th. The Company issued Russian ruble-denominated bonds in an aggregate principal amount of RUR 20 bln (~$658 mln). The bonds are guaranteed by OJSC “Vimpel-Communications”, have a five-year maturity and bear an annual interest rate of 8.3%. The proceeds of the offering will be used for financing development and expansion of OJSC VimpelCom’s core business. November 15 th. The Supervisory Board of VimpelCom Ltd declared the payment of an interim dividend in 2010 of US$0.46 per American depositary share, amounting to a total interim dividend payment of approximately $600 mln. Vimpelcom Ltd. highlights USD, mln9m 20099m 2010Y-to-Y Revenue % OIBDA % OIBDA margin, %49.8%47.8%-2.0 p.p. Net Income %
55 Megafon Megafon highlights Megafon reported excellent financial results for the third quarter and nine months 2010: The 3-month active subscriber base in Russia, Tajikistan, Abkhazia and South Ossetia had reached 56.6 mln subscribers by the end of October (or +6.1 mln subscribers from start-2010). The Company made a row of successful acquisitions, including universal infrastructure network provider Synterra and Saint-Petesburg based fixed network provider Metrocom. MegaFon successfully utilize mobile data market growth: Company has the widest 3G network in Russia, data revenue market share among BIG3 around 44% and data revenue share in total revenue growth from 6% in 2009 to 11% in The Company successfully strengthened its market position in Russia compared to main competitors – MTS, Tele2 and Vimpelcom and continue to growth its revenue market share. RUR, mln9m 20099m 2010Y-to-Y Revenue % OIBDA % OIBDA margin, %48.8%45.8%-3.0 p.p. Net Income %
66 Turkcell Turkcell highlights Turkcell reported audited results for the third quarter and nine months In spite of the challenging market conditions, together with pressure from both the regulator and its competitors, Turkcell has continued to maintain its number one position in terms of subscribers, revenue and EBITDA-market share. Turkcell successfully defends its market positions and collects around 90% EBITDA margin from the mobile market in Turkey. Turkcell enjoys strong growth in mobile data subscribers with third quarter mobile revenue up by 28% Y-to-Y. 3G network rollout is on schedule and is expected to be main driver for revenue growth in nearest future. Altimo seeks the successful resolution of its litigation against Cukurova. USD, mln9m 20099m 2010Y-to-Y Revenue % EBITDA % EBITDA margin, %34.4%32.6%-1.8 p.p. Net Income %
7 Altimo to establish new global telecom leaders NEW HOLDING Altimo strikes 2 major deals in merging its assets with telecoms market-leaders, Telenor and TeliaSonera: - Working directly with Telenor, Altimo successfully merged VimpelCom, the 2 nd largest mobile operator in Russia, with Kyivstar, the largest mobile operator in the Ukraine, into a new company called VimpelCom Ltd. This unified company provide high-quality integrated mobile telecom services in Russia, the Ukraine and other CIS countries such as Georgia, Vietnam and Cambodia. Vimpelcom Ltd. is also seeking opportunities to expand its operations in other rapidly developing markets in Europe, Asia and Africa, eventually becoming a global market leader. The headquarters of the new company is located in Amsterdam, its shares listed on the New York Stock Exchange (NYSE) under symbol VIP. Altimo has 44,7% voting rights in Vimpelcom Ltd. - Also, Altimo and TeliaSonera have agreed to create a new company to hold their stakes in Megafon, the 3 rd largest mobile operator in Russia, and in Turkcell, the largest mobile operator in Turkey. The two companies will work closely to resolve any legal disputes regarding the establishment of this new company. It will be a leading international operator with more than 90 million subscribers in Turkey, Russia and the CIS countries, and will have streamlined corporate governance processes. The new company will be established in a Western jurisdiction and listed on the NYSE. * - with the disputed stake which was appropriated by Altimo as the collateral in the defaulted loan to Cukurova. 100% 68,9% 55,8%*
8 Weather acquisition - first step to global expansion Source:World Cellular Information Service, Company information Note: Figures as of June 2010 based on proportionate subscribers Vimpelcom Ltd. made first step to global expansion by signing an agreement with Weather holdings to acquire Wind Italy and OTH assets. VimpelCom Ltd.Weather Investments (excluding Wind Hellas) Weather assets to be spun off
9 Weather acquisition - creating a leading global operator Source:World Cellular Information Service Note: Figures as of June 2010 based on proportionate subscribers Orascom Telecom adjusted for spin-off assets (North Korea and Egypt)
10 Weather acquisition – expanding basis for further growth Access to attractive assets and markets Platform for growth Diversification Value creation Optimised balance sheet Sound corporate governance Combined revenues of US$21.5bn Significantly enhances managerial bandwidth Low cost model knowledge from Wind Italy High standards of corporate governance Listed on the NYSE Balance shareholder structure retained Dividend policy retained Sound pro forma financials Robust de-leveraging profile supported by strong operating free cash flows Ability to support dividend payments going forward Diversified revenue base – Russia drops from 74% to 35% of group revenues Attractive mix of developed and emerging markets assets 849 million population coverage 174 million subscribers – top 5 globally Footprint in attractive emerging markets Solid European growth asset Acceptable transaction multiple US$2.5 billion value creation through opex and capex synergies Large under-penetrated markets Global scale to capture data upside
11 Assets capitalization level Despite lengthy global economic turmoil Altimo’s assets capitalisation level increased twofold to $16 bn during the last 5 years. Vimpelcom-Kyivstar merger and announcement of further acquisition of Weather put strong pressure on Vimpelcom Ltd. capitalization that resulted in ‘flat’ assets capitalization Y-to- Y. 100% (US$bn)