VimpelCom close to agreement with Algerian government over Djezzy
17 January 2013 | Kavit Majithia
Russian operator VimpelCom has confirmed it expects to reach a deal with the Algerian government this year to retain control of its operations in the country.
The New York listed company has had a long-running dispute with regards to its Algerian business, an asset seen as integral for future growth.
According to Financial Times sources, Djezzy, VimpelCom’s Algerian subsidiary, has widespread earning potential and the company is prepared to hold on to it, even if it is forced to sell a minority stake to the Algerian government.
In a strategy update conducted by the company yesterday, VimpelCom declared intentions to increase annual cash flow by $2.9 billion by the end of 2015, and aims to pay dividends of 80% between 2012 and 2014.
It will be targeting a range of new initiatives for higher earnings, including new mobile data tariffs.
VimpelCom further declared intentions to increase investment in Algeria, as well as increasing network spend in its domestic market.
VimpelCom’s chief executive, Jo Lunder, claims the company has “good momentum and progress with the government in Algeria. There is a willingness on both sides to reach an agreement”.
Lunder declared the company is still reviewing its international portfolio, after declaring intentions to sell off several emerging market operations last year.
VimpelCom is the sixth largest mobile operator by subscribers, with major operations in Europe and North America.