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well as include subscription to Rambler content in its pilot digital content package. The integration of Rambler resources into Sberbank ecosystem is likely to continue further, the analysts surveyed by Kommersant daily believe. Reportedly, Sberbank will invest RUB11bn, primarily into development of Okko. The CEO German Gref in 2018 said that Sberbank could in the future drop the "bank" from the name while transforming itself into the Sber ecosystem that covers all basic need of both the corporate and private clients. On April 23 Vedomosti daily reported that Sberbank officially registered the Sber trademark, in addition to buying domains sber.ru.
9.2.8 Telecoms corporate news
Chinese tech giant Huawei has signed a deal with Russian telecoms company MTS to develop a 5G network in the country over the next year, BBC News reported. The agreement was signed on the sidelines of a meeting between Chinese leader Xi Jinping and Russian president Vladimir Putin in Moscow. It will see “the development of 5G technologies and the pilot launch of fifth-generation networks in 2019-2020,” MTS said in a statement on Wednesday. Quoted in the statement, Huawei’s Guo Ping, one of the company’s chairmen on rotation, said he was “very happy” with the agreement “in an area of strategic importance like 5G.” At a Moscow meeting between Putin and Xi, the Chinese leader called his Russian counterpart his “close friend”, noting that they had met nearly 30 times over the past six years. The trip is Xi’s eighth to Russia since 2012.
Russian mobile major VEON (former Vimpelcom) and the Egyptian Tax Authority (ETA) agreed to settle the 2000-2018 $136mn tax claim of VEON's subsidiary Global Telecom Holding (GTH), while approving VEON’s acquisition of a 42.3% stake in GTH from minorities in a mandatory tender offer. "The tender offer values GTH at $1.4bn, which is in line with our valuation of GTH," Sberbank CIB commented on June 27. GTH's Algerian assets are valued at around $600mn, the Bangladesh assets at around $300mn and the Pakistan assets at around $2bn. VEON plans to consolidate the stake in GTH by year-end and delist GTH from the Egyptian Exchange by year-end (mandatory delisting if VEON accumulates more than 95%, or voluntary requiring approval of 75% of shareholders). Sberbank CIB sees the news as positive for VEON, with the approval from the FRA being a vital step in taking GTH private. BCS Global Markets on June 27 suggested that the offer should help to simplify Veon's holding structure and cash upstream, with high chances of approval expected from the minority shareholders. VEON showed 6% revenue decline to $2.2bn and Ebitda slip to 4% to $0.82bn at 39% margin in the first quarter of 2019. The company's results in 1Q19 were affected by weaker currencies in Russian and Pakistan, which if unaccounted for, would make 7% and 10% revenues and Ebitda growth, respectively. Previously in the fourth quarter VEON reported unexciting results. But in the first quarter of 2019 "the numbers came in ahead of our expectations on EBITDA thanks to better profitability in Ukraine and more significant cut in HQ costs; this still suggests a decline y/y due to currency headwinds in the countries of operation," BCS Global Markets commented on May 3.
Rostelecom expects the government will approve its purchase of Tele2 operator and the transaction will close before the end of the year, the head of the company Michael Oseevsky said on June 14. “We are working with the government. We are moving forward. We expect that in summer all
109 RUSSIA Country Report July 2019 www.intellinews.com