Published: August 8, 2013
Russian telco buys Scartel in US$1.2bn deal.
MegaFon, Russia’s second-largest mobile operator, has bought compatriot Scartel for US$1.2bn.
The acquisition of the 4G mobile broadband specialist has been given the thumbs up by MegaFon’s board and is scheduled to be approved in a shareholder vote on September 12. At present Scartel is owned by Garsdale, MegaFon’s controlling shareholder.
Scartel, which operates under the name Yota, is the only operator in Russia with a multi-city 4G broadband network. It had 648,000 subscribers as of end June and its network covers 27% of Russia’s population.
In a filing to the London Stock Exchange, MegaFon said that the acquisition should lead to “a significant increase in network capacity and quality” and “considerable cash flow savings” due to the reduced need to rollout and maintain new 4G infrastructure.