PJSC ROSTELECOM (FRA:US778529) ROSTELECOM PJSC: Rostelecom acquires one of the leading Internet and pay-TV providers in the Primorsky region

Directive transparence : information réglementée

05/08/2019 08:30

ROSTELECOM PJSC: Rostelecom acquires one of the leading Internet and pay-TV providers in the Primorsky region

05-Aug-2019 / 09:30 MSK
Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group.
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Rostelecom acquires one of the leading Internet and pay-TV providers

in the Primorsky region

Moscow, Russia - August 5, 2019 - Rostelecom PJSC (MOEX: RTKM, RTKMP; OTCQX: ROSYY), the largest digital service provider in Russia, today announces that its subsidiary Bashinformsvyaz ("Bashtel") has signed an agreement to acquire a 100% stake in three companies to secure full control over the Alliance Telecom Group. Alliance Telecom has been providing Internet access and TV services across the Primorsky region since 2007, servicing individual clients and business in the cities of Vladivostok, Ussuriysk, Nakhodka and Artyom.

As for the household segment, which accounts for 80% of Alliance Telecom's revenue, the operator is an undisputable leader in Vladivostok and one of the leading providers in the Primorsky region overall with a subscriber base of 110,000 families. The company also serves more than 6,000 B2B clients which are predominantly consuming a mono- broadband service.

In 2018, Alliance Telecom's turnover amounted to over RUB 900 million.

The deal is in line with Rostelecom's strategic priority to develop its digital ecosystem and client services offering.

Anna Shumeyko, Senior Vice President and Chief of Staff of the Presidential executive office of Rostelecom, commented: "The acquisition will strengthen Rostelecom's position in the broadband internet market in the Primorsky region. We are seeing a lot of opportunities to realise the synergy effects from operational cost optimization as well as from upselling the Alliance Telecom subscriber base with an expanded set of services, currently available to Rostelecom's clients."

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PJSC Rostelecom is the largest digital service provider, operating in all segments of the telecommunications market in Russia, it serves millions of households, the state and private enterprises across the country.

Rostelecom is Russia's undisputed market leader, providing high-speed Internet access to over 13 million users and pay-TV services to more than 10.2 million families, over 5.4 million of which are subscribed to Rostelecom's IPTV services on a national level.

In the six months of 2019, the Group generated RUB 158.8 billion of revenues, RUB 53.5 billion of OIBDA (33.7% of revenue) and RUB 10.0 billion of net income.

The Group is the leading provider of telecommunications services to government bodies and corporates of all levels.

Rostelecom is a key strategic innovator that provides solutions in the following fields: E-Government, cybersecurity, data-centers and cloud computing, biometry, healthcare, education and housing & utility services.

The Group's stable financial position is confirmed by its credit ratings. Rostelecom has been assigned 'BBB-' and 'BB+' international credit ratings by Fitch Ratings and Standard&Poor's respectively, and AA(RU) by ACRA.

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Certain statements in this press release are forward-looking statements within the meaning of the U.S. federal securities laws and intended to be covered by the safe harbours created thereby.

Those forward-looking statements include, but are not limited to:

  • Assessment of PAO Rostelecom's (the Company) future operating and financial results as well as forecasts of the present value of future cash flows and related factors;
  • The Company's plans to take ownership stakes in other organisations;
  • the Company's anticipated capital expenditures and plans to construct and modernize its network;
  • the Company's expectations as to the growth in demand for its services, plans relating to the expansion of the range of its services and their pricing;
  • the Company's plans with respect to improving its corporate governance practices;
  • the Company's expectations as to its position in the telecommunications market and forecasts on the development of the market segments within which the Company operates;
  • economic outlook and industry trends;
  • the Company's expectations as to the regulation of the Russian telecommunications industry and assessment of impact of regulatory initiatives on the Company's activity;
  • other statements regarding matters that are not historical facts.

Such forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from those expressed or implied by these forward-looking statements. These risks, uncertainties and other factors include:

  • risks relating to changes in political, economic and social conditions in Russia as well as changes in global economic conditions;
  • risks relating to Russian legislation, regulation and taxation, including laws, regulations, decrees and decisions governing the Russian telecommunications industry, securities industry as well as currency and exchange controls relating to Russian entities and their official interpretation by regulatory bodies;
  • risks relating to the Company, including the achievement of the anticipated results, levels of profitability and growth, ability to create and meet demand for the Company's services including their promotions, and the ability of the Company to remain competitive in a liberalized telecommunications market;
  • technological risks associated with the functioning and development of the telecommunications infrastructure, technological innovations as well as the convergence of technologies;
  • other risks and uncertainties. For a more detailed discussion of these and other factors, see the Company's Annual Report and the Company's other public filings.

Many of these factors are beyond the Company's ability to control or predict. Given these and other uncertainties, readers are cautioned not to place undue reliance on any of the forward-looking statements contained herein or otherwise. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements (which are made as of the date hereof) to reflect events or circumstances upon the annual report publication or to reflect the occurrence of unanticipated events, except as may be required under applicable laws.



ISIN: US7785291078
Category Code: ACQ
LEI Code: 2534001D752JPNM0H170
Sequence No.: 15675
EQS News ID: 851637

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