VimpelCom to Acquire Golden Telecom for $4.3B

Vimpel-Communications (VIP), Russia's second-largest wireless carrier, has agreed to acquire Golden Telecom (GLDN), a Russian broadband and fixed-line operator, for around $4.24B, or $105/share. The deal represents a 5% premium over Golden's Thursday Nasdaq close. The two companies disclosed they were in talks on Dec. 3. VimpelCom said it will commence a tender offer on or before Jan. 18, to acquire 100% of Golden's outstanding shares. The boards of both companies unanimously approved the transaction.

Golden will provide exposure to Russia's growing broadband market. Despite its slowing fixed-line business, Golden is the leading provider of telecom services to Russian businesses. Bloomberg reports the acquisition would create the first integrated mobile/fixed-line provider in Russia. ADRs of VimpelCom gained 4.4% to $39.38 on Thursday. Golden lost 0.15% to $100.06 during normal trading, but spiked 10% to $110.00 in thin volume late trading. VimpelCom is a 4.8% holding of Market Vectors Russia ETF (RSX)

Sources: Press release, Bloomberg, Wall Street Journal
Additional Reading: VimpelCom Higher On Q3 Beat Driven by Russian Growth • Vimpel Communications Q3 2007 Earnings Call Transcript

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