ARMENIA APPROVES VIMPELCOM’S TAKEOVER OF TELECOMS CO. ARMENTEL

RIA Novosti, Russia
Nov 14 2006

YEREVAN, November 14 (RIA Novosti) – Armenian authorities have approved
the sale of a 90% stake in telephone company Armentel, held by a
Greek firm, to Russia’s VimpelCom [RTS: VIMP] for $438.9 million,
the state commission for public services regulation said Tuesday.

As well as buying the stake from Greek telecoms group Hellenic
Telecommunications Organization SA (OTE), Russia’s second largest
mobile operator, best known for its Beeline brand, will take on
Armentel’s debt totaling around 40 million euros ($51 million).

VimpelCom, controlled by Russia’s Alfa Group and Norway’s Telenor,
beat Russian mobile market leader MTS [RTS: MTSS] at the tender for
the Armentel stake, which will give it 40% of the Armenian mobile
telecommunications market. The takeover will be completed by the end
of 2006, VimpelCom said.

The Armenian government ceded its right to purchase the stake from
OTE on November 9.

Before receiving the authorities’ approval, VimpelCom and OTE had
closed the deal, worth 341.9 million euros ($438.9 million).

Armenian Communications Minister Andranik Manukyan earlier said
the government will sell VimpelCom the remaining 10% stake, on the
condition that the company does not attempt to monopolize the South
Caucasus country’s telecoms market.

Greece’s OTE bought Armentel in 1997 for $142.5 million, and has
since invested $300 million in the company, whose earnings in 2005
stood at 110 million euros ($140 million).

Armentel has about 600,000 fixed-line and 400,000 mobile service
subscribers, and uses the GSM 900 and CDMA standards.

As well as Russia, VimpelCom operates in the former Soviet republics
of Kazakhstan, Georgia, Tajikistan, Ukraine, and Uzbekistan.