VEON Considering IPO for Kyivstar

By Gianluca Lo Nostro and Leo Marchandon
(Reuters) – Telecoms group VEON (NASDAQ:VEON) is contemplating an initial public offering (IPO) for its Ukrainian unit Kyivstar in the U.S. as early as next year, according to CEO Kaan Terzioglu in an interview on Thursday.

"We have not made those decisions yet, but we are committed to looking into IPOs of our local assets. And clearly, Kyivstar is one of those assets which could be in the line of this process," he stated.

If successful, Kyivstar would be the first Ukrainian company listed in the United States. However, Terzioglu noted that there have been no discussions with Ukrainian officials as the process remains in its infancy. He previously suggested a potential listing in Warsaw or London may also be explored.

For Ukraine, Terzioglu indicated that a local IPO might take longer compared to an international listing.

These comments followed a partnership Nasdaq formed with the Ukrainian government in February aimed at bolstering Ukrainian capital markets.

In October, Shah Capital, an activist investor owning a 6.75% stake in VEON, encouraged the company to list Kyivstar on Nasdaq to "unfreeze ownership shares." A Kyiv court previously froze 47.85% of Kyivstar's corporate rights related to past associations with sanctioned Russian individuals in VEON.

INVESTMENTS IN UKRAINE'S ENERGY SECTOR

VEON reiterated its pledge to invest $1 billion (950 million euros) in Ukraine's digital infrastructure by 2027. "We have almost half a billion dollars of cash in Ukraine, so we will continue investing," Terzioglu remarked. "Don't be surprised even if we go and buy assets in Ukraine," he added, mentioning that VEON has identified potential investments in energy generation and distribution, including solar power.

When asked about the potential impact of Donald Trump's re-election on VEON's operations in Ukraine, Terzioglu commented that his monetary and energy policies are very favorable for frontier markets, like VEON's. Notably, last year, former U.S. Secretary of State Mike Pompeo joined the board of Kyivstar.

VEON, having relocated its headquarters to Dubai, is also working towards completing its delisting from Amsterdam by November 25 to focus solely on its U.S. listing. Furthermore, they are assessing a potential listing for their Pakistani unit Jazz, though no specific timeline was mentioned by Terzioglu.

(1 euro = $1.0524)