Rostelecom Restructuring - Risks and Rewards

The Federal Anti-monopoly Service (FAS) has confirmed that it has given state-owned telecoms holding company Svyazinvest approval for the proposed acquisition of Russian mobile operator Mobitel. The deal will see Svyazinvest acquire a combined 99.99% of Mobitel through its subsidiaries. Kommersant is also reporting that Rostelecom, Svyazinvest's long-distance fixed-line operator, is attempting to acquire a 21.8% stake in National Telecommunications (NTC). The approval from FAS is a milestone in the long-running reorganisation of Svyazinvest; however, BMI remains sceptical about the potential for a market-leading telecoms firm to be formed from Svyazinvest's constituent parts and believe the strategy to be too ambitious._x000d_

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