Ukraine Facebook Protests Seen Boosting MTS to VimpelCom
Oleksiy Vlasov said it was a friend’s Facebook posting one night last month that pulled him out of his bed and into a crowd of thousands of fellow Ukrainians demanding the president’s resignation.
“It said that if you were ready to stand up for what you believe in, join me,” the 38-year-old Kiev native said.
The two-week-long protests seeking the ouster of President Viktor Yanukovych, much like the revolutions that swept across the Middle East in the Arab Spring of 2011, are being organized over social networking sites. The result is an anticipated boom in data traffic that will trigger stock rallies in Russia’s OAO Mobile TeleSystems and VimpelCom Ltd., which control the largest mobile phone operators in Ukraine, according to JPMorgan Chase & Co. and Raiffeisen Bank International AG.
“It’s just logical that traffic rises now,” Sergey Libin, an analyst at Raiffeisenbank in Moscow, who rates MTS a buy and VimpelCom a hold, said by phone. “What is yet unknown is how many more people will join and for how long the protests will last.”
VimpelCom said voice traffic increased 15 percent in Kiev on Dec. 1 when protests intensified, compared with an average weekend level, Artem Minaev, Amsterdam-based spokesman for the company, said via e-mail today. Data traffic grew 5 percent, he said.
MTS, Russia’s largest wireless carrier, rose 2.3 percent to $20.28 in New York as of 9:39 a.m., trading at a 4.8 percent premium to the Moscow stock. MTS gained 8.7 percent this year. VimpelCom, the wireless carrier controlled by Russian billionaire Mikhail Fridman, rose 2.1 percent to $11.99, widening its 2013 advance to 14 percent.
MTS shares jumped 4.1 percent, the most since Sept. 5, to 317.55 rubles, or $9.70, in Moscow today. The Micex Index added 1.4 percent to 1,448.67.
VimpelCom’s Kyivstar JSC, Ukraine’s biggest mobile phone company, had 25.9 million subscribers in Ukraine by the end of September, compared with MTS’s 22.4 million, according to Moscow-based research agency Advanced Communications & Media.
Ukraine made up 9.6 percent of last year’s total revenue for MTS and 7.2 percent for VimpelCom, data compiled by Bloomberg show.
MTS boosted third-quarter earnings as it added subscribers in Moscow and Ukraine. Data revenue in Russia increased 45 percent to 12.5 billion rubles, the company said in a Nov. 19 statement.
Nikolai Minashin, investment relations manager at MTS in Moscow, declined to comment.
Hundreds of thousands of demonstrators in Ukraine’s major cities are protesting civil rights infringements and a government decision to back off signing a free-trade accord with the European Union. Protests began on Nov. 21 when Yanukovych suspended progress toward an association agreement with the EU, opting instead to strengthen ties with Russia.
Opposition led by lawmakers, including boxing champion Vitali Klitschko, is pushing for a national strike and called on supporters to gather in downtown Kiev on Dec. 8, according to a petition posted on Facebook yesterday. Opposition leader Arseniy Yatsenyuk called on his supporters to picket Yanukovych’s residency in Mezhihirya near Kiev. He addressed his supporters from a stage on Maydan, or Independence Square, and posted it on Facebook yesterday.
“Kiev subway closes at midnight, Facebook never closes,” Vlasov said. “I am online all the time, except when I sleep. I get home by subway and have service on the subway. This is how I stay on top of it, non-stop.”
To contact the reporter on this story: Halia Pavliva in New York at firstname.lastname@example.org
To contact the editor responsible for this story: Tal Barak Harif at email@example.com