TeliaSonera sells Ncell stake to Axiata for $1.03bn

12 April 2016 | Jason McGee-Abe


TeliaSonera has sold its 60.4% stake in Ncell, Nepal’s largest private cell phone service provider, to Axiata in one of the biggest takeover deals in the country’s history.

TeliaSonera logoTeliaSonera announced the completion of the divestment of its holding in Reynolds Holding, which owns Ncell, to Malaysian-based operator Axiata for £1.03 billion (circa NRS 109.86bn).

This was after it obtained approval from all relevant authorities, pursuant to the terms of the ‘conditional sale and purchase agreement’ announced on December 21, 2015. "The transaction is subject to customary closing balance sheet adjustments based on net debt and net working capital,” a TeliaSonera statement read.

“I am very pleased to announce the completion of our divestment of Ncell to Axiata, according to our announcement in December and in line with our ambition to reduce our presence in Eurasia over time. Axiata is a suitable new owner of Ncell and it gives me comfort that our dedicated employees are in good hands,” says Johan Dennelind, TeliaSonera’s President and CEO.

Some reports have note that the delay in regulatory approval may have been as a result of a dispute as to whether Nepal should receive capital gain tax from the acquisition.

TeliaSonera will be paid for Ncell's cash position in proportion to its economic interest of 80.4%. Furthermore, TeliaSonera has dissolved its economic interests in the 20% local ownership in Ncell and received approximately $48 million from Sunivera Capital Ventures, Singapore.

Axiata has approximately 275 million customers and 25,000 employees in Asia. Ncell will complement its portfolio of Asian telecommunications assets, which includes operations in Malaysia, Indonesia, Sri Lanka, Bangladesh, Cambodia, India, Singapore, Myanmar and Pakistan.

In December, Axiata had announced it had entered into an agreement to acquire 80% in Ncell for $1.365 billion (RM 5,907mn). Reynolds holds 800,000 shares representing 80% equity interest in Ncell. This included a £335.1 million bid for Kazakh-based SEA Telecom Investments BV’s 19.6% stake in Ncell.