The European Bank for Reconstruction and Development (EBRD) and the International Finance Corporation (IFC) of the World Bank Group (WB) will provide $435 million in financing for the merged Datagroup-Vola-Lifecell following the completion of the acquisition of Ukrainian assets by France’s NJJ.
“On the sidelines of the Ukraine Recovery Conference (URC2024) in Berlin, we reached strategic agreements with the EBRD and IFC to finance the projects of the combined Datagroup, Volia and Lifecell for up to $435 million,” Datagroup-Volia CEO Mykhailo Shelemba wrote on Facebook on Tuesday evening.
According to him, the funds will be allocated after the acquisition and merger of the companies is finalized. They will be used to support the convergence of fixed mobile communications (FMC), increase investments in the combined network, and purchase licenses and equipment needed to expand fixed and mobile infrastructure.
“I thank the EBRD and IFC for supporting Ukraine and Ukrainian business in this difficult time of war. And once again, I thank NJJ Holding and personally (its owner – IF-U) Xavier Niel for their faith in Ukrainians and our development potential,” Shelemba wrote.
He noted that the entry of a global Western strategic operator into the Ukrainian telecom market and the financing of the merged company by international structures should have a positive impact on Ukraine’s economy: it will accelerate future growth, increase resilience in difficult military conditions and help bridge the country’s digital divide.
Earlier it was reported that the AMCU at its meeting on March 7 allowed DVL Telecom, a subsidiary of NJJ, to acquire control over Datagroup Holding Limited (Datagroup-Volya). At the same time, the Committee announced that it had found grounds for prohibiting DVL Telecom’s acquisition of control over the Turkcell-controlled Lifecell Group and requested additional information in April. Turkcell expects the deal with NJJ to be closed by the end of 2024.
NJJ’s investment in Datagroup-Vola-Lifecell, owned by French billionaire Xavier Nel, will amount to $1.5 billion, which includes the purchase of 100% of the companies’ assets and investment commitments for five years.
“For Ukraine, in fact, the issue of $1.5 billion in investments is being resolved, which includes the amount of the deal and capital investments to be made in the next five years,” Datagroup-Vola-Lifecell CEO Mykhailo Shelemba told Interfax-Ukraine.
He also noted that Datagroup-Vola-Lifecell, which will be established after the deal is completed, plans to participate in auctions for the allocation of 2355-2395 MHz, 1935-1950/2125-2140 MHz and 2575-2610 MHz mobile radio frequencies, which the National Commission for the State Regulation of Electronic Communications, Radio Frequency Spectrum and Postal Services may hold in August.
“Frequencies are the main asset for any mobile operator. Lifecell currently has enough frequencies to provide quality services, but we want to grow and will need more frequencies,” Shelemba said.
He emphasized that the entry of such an investor as NJJ into the tender “will increase competition for frequencies by an order of magnitude, so the state will be able to raise more money.”
“And we are talking about tens of millions of dollars…” Shelemba said.
Earlier it was reported that the investment company NJJ, owned by French billionaire Xavier Nel, will merge their assets into a single company that will offer customers a triple package of services after the acquisition of Datagroup-Volia fixed-line telecommunications operator and lifecell mobile operator. Mr. Shelemba will head the combined Datagroup-Volia-Lifecell platform. Pierre Danon, the current chairman of the supervisory board of Datagroup-Volia, will also continue to serve as chairman of the supervisory board of the combined entity.
The transaction is subject to final regulatory approvals and other closing conditions. As reported earlier, the Antimonopoly Committee of Ukraine (AMCU) has found grounds to ban the acquisition of control over Lifecell Group by DVL Telecom, a member of the NJJ group of French billionaire Xavier Niel. At a meeting on March 7, the AMCU allowed DVL Telecom to acquire control of Datagroup Holding Limited (Datagroup-Volya).
Turkcell CFO Kamil Kalyon confirmed during the investor Q&A session at the company’s 2023 financial results presentation that the transaction with NJJ was set at $525 million at the time of closing, but the final amount would be subject to adjustment.
