Mobile operator Veon may spin off Russian Beeline -Izvestia cites sources

MOSCOW, Oct 13 (Reuters) – Dutch mobile operator Veon (VON.AS) may separate its assets in Russia from the wider company, Russia’s Izvestia daily quoted three unidentified sources as saying on Thursday – a report that pushed Veon’s Moscow-listed shares over 20% higher.

Veon operates its Beeline brand through its subsidiary Vimpelcom in Russia, a market that accounts for around half of the group’s revenues. Veon also operates Beeline in Kazakhstan and Kyivstar in Ukraine.

“We regularly evaluate our portfolio and look for investment or divestment activity that could create value for VEON’s stakeholders,” Veon said in a statement. “We cannot say more than that or speculate about our plans with regard to any of our portfolio companies.”

Izvestia reported that Vimpelcom and Veon were discussing a way for Vimpelcom to fall under the ownership of entirely Russian capital, without providing further details. The newspaper’s sources stressed the discussions were merely ideas for now.

Veon’s shares have traded near record lows since tumbling after Russia sent its armed forces into Ukraine in February. Since then, scores of foreign firms have sought to reduce exposure to Russia and paused or terminated operations there.

In Amsterdam, Veon shares were up around 7% by 1052 GMT.

Leonid Konik, editor-in-chief of ComNews, a telecoms and IT-focused publication, told Reuters there had been rumors about a sale of Beeline for 10 years.

“But for political and business reasons, such a sale is more relevant than ever,” Konik said.

Mikhail Fridman, one of the Russian investors behind Veon’s major shareholder Letter One, has criticized Moscow’s actions in Ukraine.

He and his business partner Petr Aven, who have been hit with Western sanctions, have denied any financial or political relationship with President Vladimir Putin or the Kremlin.

Konik said: “In Russia, the ‘friend or foe’ system has escalated really strongly and they will not be able to keep their feet in both camps.”

Reporting by Alexander Marrow; Editing by Kevin Liffey and Mark Potter

Our Standards: The Thomson Reuters Trust Principles.

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