Tele2 said the definitive agreement to sell Tele2 Russia to VTB "was based on its experience in owning and successfully developing Tele2 Russia over many years, and a full awareness of all strategic options available to Tele2 with respect to its Russian business". The operator was advised by Morgan Stanley as financial adviser and Davis Polk and Mannheimer Swartling as legal and regulatory advisers.
Under the terms of the transaction, which is expected to be completed shortly, Tele2 said it has rights for a period of 12 months after closing to half of the net cash profits obtained by VTB from certain types of transfers of Tele2 Russia shares and assets to non-VTB Group entities. Tele2 agreed to sell the Russian activities for USD 2.4 billion plus USD 1.15 billion in debt.
Meanwhile MTS has said it plans to go directly to Tele2 shareholders to lobby for its higher offer with rival Russian mobile operator Vimpelcom. Michael Hecker, who heads strategy for MTS, told the Wall Street Journal that "within minutes" of his company and Vimpelcom announcing an offer for Tele2 Russia, he was contacted by frustrated Tele2 shareholders willing to back the rival bid. The two companies hope Tele2 shareholders can convince the company to abandon the VTB deal for their own offer.
