OAO MegaFon and its main shareholder billionaire Alisher Usmanov bought 50 percent of Euroset Holding NV in a deal that gives Russia’s biggest handset retailer an enterprise value of $2.3 billion.
MegaFon, Russia’s second-largest mobile operator, and Usmanov paid a combined $1.07 billion to buy equal stakes from billionaire Alexander Mamut and may pay an $100 million more if Euroset meets “certain targets” in the first half of 2013, MegaFon said in a statement today. The operator is expected to buy Usmanov’s 25 percent of Euroset in a year, it said.
Russian mobile operators are expanding into retail to increase revenue from users and participate in profits from rising smartphone sales. MegaFon’s competitor VimpelCom Ltd., owned by billionaire Mikhail Fridman and Telenor ASA, said today it raised its stake in Euroset by 0.1 percent to 50 percent. OAO Mobile TeleSystems, Russia’s largest mobile operator, runs its own retail outlets nationwide.
MegaFon said the investment in Euroset is “instrumental in further enhancing the quality of its subscriber base and in helping to reduce churn.” The Euroset value includes net debt, the company said.