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Complicated maneuvers of Alpha: do all roads lead to Ukraine?

Alfa-Group's desire to strengthen its positions in the telecommunications market of Ukraine is quite obvious. VimpelCom's (or Alfa's?) recent "demarche" - a demonstration of intentions to acquire the Ukrainian WellCOM - is only one step in a complex multi-way combination. Who will merge / spill with whom is not yet clear, however events begin to develop at an increasing speed.

In our report on VimpelCom's signing of an option to acquire 100% of WellCOM's shares, we expressed cautious concerns about Kyivstar's possible problems with the current administration of Ukraine. Literally a few days after the publication, the topic received an unexpected continuation: Alfa-Telecom Holding increased its stake in the Ukrainian company Storm, which owns 43.49% of Kyivstar shares, to 100%. With a very high degree of probability, it can be assumed that Alfa Telecom acquired, among other things, shares belonging to people from the entourage of former Ukrainian President Leonid Kuchma. Thus, Kyivstar can be considered delivered from the "burden of the past", and Alfa once again confirmed its interest in the fate of the second largest Ukrainian GSM operator.

The controlling stake in Kyivstar (56.51%) is still owned by the Norwegian company Telenor, which is also one of the main shareholders of VimpelCom (Telenor and Alfa own 26.6% and 32.9% of VimpelCom shares, respectively). Alfa is interested in merging Kyivstar with VimpelCom, but this turn of events does not suit Telenor, since in this case Telenor's share in the merged company will be less than the controlling one. Is the notorious "control" of the Norwegian company really necessary? It is very necessary: ​​today Telenor is consolidating Kyivstar's figures into its financial statements, and with the loss of a controlling stake, it would lose such an opportunity, which would cause a significant deterioration in the financial performance of the Norwegian company. In the same connection, Telenor's dissatisfaction with VimpelCom's possible entry into the Ukrainian market through the acquisition of WellCOM, and the appearance of lawsuits by VimpelCom's "minority shareholder" demanding that the charter be changed so that asset acquisition transactions are approved by a simple (rather than qualified) majority in the Board of Directors. Such a change in the charter would deprive Telenor of the ability to block decisions to acquire the assets of the Ukrainian operator (Telenor representatives occupy four of the nine seats on the VimpelCom Board of Directors).

Theoretically, Telenor could sell its stake in VimpelCom to Alfa, but such a deal is clearly unprofitable for two of the three participants: Telenor would lose a profitable long-term asset, and VimpelCom would lose the care and protection of the Norwegian government. Recall that in many respects thanks to this intercession, the Ministry of Communications failed in 2000 to take away part of the 900 MHz frequencies from VimpelCom and transfer them to another operator, and the intervention of the Norwegian government in the recently organized conflict between VimpelCom and the tax authorities contributed to the development of a compromise.

In the meantime, events are actively developing on the other front. TeliaSonera recently announced a deal to acquire a 27% stake in Turkcell, but Kirill Babaev, vice president of Alfa-Telecom holding, unexpectedly announced in an interview that Alfa had counter-offered to acquire these assets at a higher price. There are no official statements yet, but such a deal looks quite logical for Alpha. Cnews data:

…in addition to Turkey, Turkcell also owns significant assets in the CIS countries. In particular, it owns 51% of Euroasia Telecommunication Holdings, which, in turn, owns 100% of the shares of the Ukrainian Astelit, which recently launched a GSM network under the life:- trademark). In addition, Astelit controls a 99% stake in the dAMPS operator Digital Cellular Networks of Ukraine (DCC). In addition, Turkcell owns 41.45% of the shares of FinTur Holdings, registered in the Netherlands, among whose assets are controlling stakes in a number of leading GSM operators in the CIS: 79.78% of the shares of Azertel, which owns 64.3% of the shares of the Azerbaijani mobile operator Azercell , 51% of the shares of the Kazakh K-Cell (trademark "GSM-Kazakhstan"), 80% of the shares of the Moldovan MoldCell and a controlling stake of the Georgian GeoCell.

In this case, we are interested in the assets of Turkcell in the Ukrainian company Astelit. The DCC operator owned by this company has recently been actively developing the GSM (life) network. Unfortunately, only in the 1800 MHz band, there is no license for 900 MHz. But WellCOM has such a license (but no license for 1800 MHz), so the two networks are "made for each other". However, such an intricate scenario is hardly likely.

Finally, let's not forget about the ongoing legal conflict between the Bermuda offshore IPOC International Growth Fund Ltd and LV Finance, which through its CT-Mobile structure controlled a 25.1% stake in MegaFon and sold these shares to Alfa (according to IPOC - illegally) We wrote about this conflict last year. Judging by some foreign publications, LV Finance may eventually lose numerous lawsuits and Alfa may lose its 25.1% of assets in MegaFon as a result. Indirect confirmation is the behavior of Leonid Mayevsky, who recently left abroad and published his statement about his forced departure from there due to possible harassment by the Russian authorities. However, court battles are slow and will last another six or eight months, and it is high time for MegaFon to go public in order to attract additional capital for the development of the network. Both parties are interested in a speedy peaceful resolution of the conflict, and Alfa's attempt to "steal" a deal on Turkcell assets from TeliaSonera may mean Alfa's desire to create a counterbalance that can be used in the negotiation process. Recall that TeliaSonera owns a 35.6% stake in MegaFon and the deal to acquire a part of Turkcell could well be caused by the desire to bring MegaFon to the Ukrainian market. Thus, Turkcell shares in the hands of Alfa can become a kind of "bargaining chip" in the asset trading of Russian and CIS operators.

Summary: one can only guess about the further development of events, but a lot will become clear in the next couple of months. It will be extremely interesting to see how many GSM operators are formed in Ukraine as a result. And even more interesting - to whom they will belong and what they will be called. Although, as for the name WellCOM, maybe it's for the best (see below).

WellCOM: "Urban" network and linguistic study

Our material about VimpelCom's possible acquisition of the WellCOM network caused a lot of feedback. We also received some clarifications from one of the employees of the company.

We quickly corrected the given outdated figures of the WellCOM subscriber base, the trend of 2005 is the outstripping growth in the number of subscribers. The rates are not dumping, however, due to the absence of the notorious "Connection fee" in the Mobi tariff, the operator's prospects are not bad. GPRS has been put into test (free) operation in Kyiv and Kharkov. It's a pity that since November 2004 WellCOM stopped publishing new connection statistics on its website.

Our somewhat sarcastic remarks about the coverage map turned out, unfortunately, to be true. Judging by the responses, the design of the map is not accidental: mainly cities are covered by the network, even most highways are not yet covered by communication. Many now successful operators started with the business model of "urban" coverage - there are an order of magnitude more potential subscribers in cities. Yes, and it is easier to advertise with specific "points of presence" than with abstract square kilometers of covered territories. However, in the near future, it will either have to expand its coverage (significant costs with a relatively small financial return), or remain a deliberately niche "urban" operator. Active expansion seems to be planned: at the next meeting of the company's shareholders, it is planned to consider the issue of attracting new investments by increasing the company's authorized capital by 9.8 times (up to 157.1 million dollars).

Assumptions about the origin of the WellCOM name turned out to be not entirely correct. Quote from a letter received on this subject from a company employee:

For my part, I would like to make some clarifications about the emergence of the name of the company "Wellcom": Initially, Well communications (good communication) was meant. Thank you for your attention.

Such, frankly, an unexpected combination of English words intrigued us and we decided to consult a specialist.

The adverb well (translated as "good") can be combined, for example, with a verb or an adjective. The adverb does not match with a noun. In this combination, the word well is unambiguously treated as a noun used as a definition for the noun communications that follows it. In this case, everything is in order with grammar, the noun well is well known and often used - for example, in the meaning of "well" or "well".
Olga Soboleva, Ph.D., Associate Professor

Back to news »

Complicated maneuvers of Alpha: do all roads lead to Ukraine?

Alfa-Group's desire to strengthen its positions in the telecommunications market of Ukraine is quite obvious. VimpelCom's (or Alfa's?) recent "demarche" - a demonstration of intentions to acquire the Ukrainian WellCOM - is only one step in a complex multi-way combination. Who will merge / spill with whom is not yet clear, however events begin to develop at an increasing speed.

In our report on VimpelCom's signing of an option to acquire 100% of WellCOM's shares, we expressed cautious concerns about Kyivstar's possible problems with the current administration of Ukraine. Literally a few days after the publication, the topic received an unexpected continuation: Alfa-Telecom Holding increased its stake in the Ukrainian company Storm, which owns 43.49% of Kyivstar shares, to 100%. With a very high degree of probability, it can be assumed that Alfa Telecom acquired, among other things, shares belonging to people from the entourage of former Ukrainian President Leonid Kuchma. Thus, Kyivstar can be considered delivered from the "burden of the past", and Alfa once again confirmed its interest in the fate of the second largest Ukrainian GSM operator.

The controlling stake in Kyivstar (56.51%) is still owned by the Norwegian company Telenor, which is also one of the main shareholders of VimpelCom (Telenor and Alfa own 26.6% and 32.9% of VimpelCom shares, respectively). Alfa is interested in merging Kyivstar with VimpelCom, but this turn of events does not suit Telenor, since in this case Telenor's share in the merged company will be less than the controlling one. Is the notorious "control" of the Norwegian company really necessary? It is very necessary: ​​today Telenor is consolidating Kyivstar's figures into its financial statements, and with the loss of a controlling stake, it would lose such an opportunity, which would cause a significant deterioration in the financial performance of the Norwegian company.In the same connection, Telenor's dissatisfaction with VimpelCom's possible entry into the Ukrainian market through the acquisition of WellCOM, and the appearance of lawsuits by VimpelCom's "minority shareholder" demanding that the charter be changed so that asset acquisition transactions are approved by a simple (rather than qualified) majority in the Board of Directors. Such a change in the charter would deprive Telenor of the ability to block decisions to acquire the assets of the Ukrainian operator (Telenor representatives occupy four of the nine seats on the VimpelCom Board of Directors).

Theoretically, Telenor could sell its stake in VimpelCom to Alfa, but such a deal is clearly unprofitable for two of the three participants: Telenor would lose a profitable long-term asset, and VimpelCom would lose the care and protection of the Norwegian government. Recall that in many respects thanks to this intercession, the Ministry of Communications failed in 2000 to take away part of the 900 MHz frequencies from VimpelCom and transfer them to another operator, and the intervention of the Norwegian government in the recently organized conflict between VimpelCom and the tax authorities contributed to the development of a compromise.

In the meantime, events are actively developing on the other front. TeliaSonera recently announced a deal to acquire a 27% stake in Turkcell, but Kirill Babaev, vice president of Alfa-Telecom holding, unexpectedly announced in an interview that Alfa had counter-offered to acquire these assets at a higher price. There are no official statements yet, but such a deal looks quite logical for Alpha. Cnews data:

…in addition to Turkey, Turkcell also owns significant assets in the CIS countries. In particular, it owns 51% of Euroasia Telecommunication Holdings, which, in turn, owns 100% of the shares of the Ukrainian Astelit, which recently launched a GSM network under the life:- trademark). In addition, Astelit controls a 99% stake in the dAMPS operator Digital Cellular Networks of Ukraine (DCC). In addition, Turkcell owns 41.45% of the shares of FinTur Holdings, registered in the Netherlands, among whose assets are controlling stakes in a number of leading GSM operators in the CIS: 79.78% of the shares of Azertel, which owns 64.3% of the shares of the Azerbaijani mobile operator Azercell , 51% of the shares of the Kazakh K-Cell (trademark "GSM-Kazakhstan"), 80% of the shares of the Moldovan MoldCell and a controlling stake of the Georgian GeoCell.

In this case, we are interested in the assets of Turkcell in the Ukrainian company Astelit. The DCC operator owned by this company has recently been actively developing the GSM (life) network. Unfortunately, only in the 1800 MHz band, there is no license for 900 MHz. But WellCOM has such a license (but no license for 1800 MHz), so the two networks are "made for each other". However, such an intricate scenario is hardly likely.

Finally, let's not forget about the ongoing legal conflict between the Bermuda offshore IPOC International Growth Fund Ltd and LV Finance, which through its structure "CT-Mobile" controlled 25.1% of the shares of MegaFon and sold these shares to Alfa (according to IPOC - illegally) We wrote about this conflict last year. Judging by some foreign publications, LV Finance may eventually lose numerous lawsuits and Alfa may lose its 25.1% of assets in MegaFon as a result. Indirect confirmation is the behavior of Leonid Mayevsky, who recently left abroad and published his statement about his forced departure from there due to possible harassment by the Russian authorities. However, court battles are slow and will last another six or eight months, and it is high time for MegaFon to go public in order to attract additional capital for the development of the network. Both parties are interested in a speedy peaceful resolution of the conflict, and Alfa's attempt to "steal" a deal on Turkcell assets from TeliaSonera may mean Alfa's desire to create a counterbalance that can be used in the negotiation process. Recall that TeliaSonera owns a 35.6% stake in MegaFon and the deal to acquire a part of Turkcell could well be caused by the desire to bring MegaFon to the Ukrainian market. Thus, Turkcell shares in the hands of Alfa can become a kind of "bargaining chip" in the asset trading of Russian and CIS operators.

Outcome: one can only guess about the further development of events, but a lot will become clear in the next couple of months. It will be extremely interesting to see how many GSM operators are formed in Ukraine as a result. And even more interesting - to whom they will belong and what they will be called. Although, as for the name WellCOM, it may be for the best (see below).

WellCOM: "Urban" network and linguistic study

Our material about VimpelCom's possible acquisition of the WellCOM network caused a lot of feedback. We also received some clarifications from one of the employees of the company.

We quickly corrected the given outdated figures of the WellCOM subscriber base, the trend of 2005 is the outstripping growth in the number of subscribers. The rates are not dumping, however, due to the absence of the notorious "Connection fee" in the Mobi tariff, the operator's prospects are not bad. GPRS has been put into test (free) operation in Kyiv and Kharkov. It's a pity that since November 2004 WellCOM stopped publishing new connection statistics on its website.

Our somewhat sarcastic remarks about the coverage map turned out, unfortunately, to be true. Judging by the responses, the design of the map is not accidental: mainly cities are covered by the network, even most highways are not yet covered by communication. Many now successful operators started with the "urban" coverage business model - there are an order of magnitude more potential subscribers in cities. Yes, and it is easier to advertise with specific "points of presence" than with abstract square kilometers of covered territories. However, in the near future, it will either have to expand its coverage (significant costs with a relatively small financial return), or remain a deliberately niche "urban" operator. Active expansion seems to be planned: at the next meeting of the company's shareholders, it is planned to consider the issue of attracting new investments by increasing the company's authorized capital by 9.8 times (up to 157.1 million dollars).

Assumptions about the origin of the WellCOM name turned out to be not entirely correct. Quote from a letter received on this subject from a company employee:

For my part, I would like to make some clarifications about the emergence of the name of the company "Wellcom": Initially, Well communications (good communication) was meant. Thank you for your attention.

Such, frankly, an unexpected combination of English words intrigued us and we decided to consult a specialist.

The adverb well (translated as "good") can be combined, for example, with a verb or an adjective. The adverb does not match with a noun. In this combination, the word well is unambiguously treated as a noun used as a definition for the noun communications that follows it. In this case, everything is in order with grammar, the noun well is well known and often used - for example, in the meaning of "well" or "well".
Olga Soboleva, Ph.D., Associate Professor

Back to news »

Complicated maneuvers of Alpha: do all roads lead to Ukraine?

Alfa-Group's desire to strengthen its positions in the telecommunications market of Ukraine is quite obvious. VimpelCom's (or Alfa's?) recent "demarche" - a demonstration of intentions to acquire the Ukrainian WellCOM - is only one step in a complex multi-way combination. Who will merge / spill with whom is not yet clear, however events begin to develop at an increasing speed.

In our report on VimpelCom's signing of an option to acquire 100% of WellCOM's shares, we expressed cautious concerns about Kyivstar's possible problems with the current administration of Ukraine. Literally a few days after the publication, the topic received an unexpected continuation: Alfa-Telecom Holding increased its stake in the Ukrainian company Storm, which owns 43.49% of Kyivstar shares, to 100%. With a very high degree of probability, it can be assumed that Alfa Telecom acquired, among other things, shares belonging to people from the entourage of former Ukrainian President Leonid Kuchma. Thus, Kyivstar can be considered delivered from the "burden of the past", and Alfa once again confirmed its interest in the fate of the second largest Ukrainian GSM operator.

The controlling stake in Kyivstar (56.51%) is still owned by the Norwegian company Telenor, which is also one of the main shareholders of VimpelCom (Telenor and Alfa own 26.6% and 32.9% of VimpelCom shares, respectively). Alfa is interested in merging Kyivstar with VimpelCom, but this turn of events does not suit Telenor, since in this case Telenor's share in the merged company will be less than the controlling one. Is the notorious "control" of the Norwegian company really necessary? It is very necessary: ​​today Telenor is consolidating Kyivstar's figures into its financial statements, and with the loss of a controlling stake, it would lose such an opportunity, which would cause a significant deterioration in the financial performance of the Norwegian company.In the same connection, Telenor's dissatisfaction with VimpelCom's possible entry into the Ukrainian market through the acquisition of WellCOM, and the appearance of lawsuits by VimpelCom's "minority shareholder" demanding that the charter be changed so that asset acquisition transactions are approved by a simple (rather than qualified) majority in the Board of Directors. Such a change in the charter would deprive Telenor of the ability to block decisions to acquire the assets of the Ukrainian operator (Telenor representatives occupy four of the nine seats on the VimpelCom Board of Directors).

Theoretically, Telenor could sell its stake in VimpelCom to Alfa, but such a deal is clearly unprofitable for two of the three participants: Telenor would lose a profitable long-term asset, and VimpelCom would lose the care and protection of the Norwegian government. Recall that in many respects thanks to this intercession, the Ministry of Communications failed in 2000 to take away part of the 900 MHz frequencies from VimpelCom and transfer them to another operator, and the intervention of the Norwegian government in the recently organized conflict between VimpelCom and the tax authorities contributed to the development of a compromise.

In the meantime, events are actively developing on the other front. TeliaSonera recently announced a deal to acquire a 27% stake in Turkcell, but Kirill Babayev, vice president of Alfa-Telecom holding, unexpectedly announced in an interview that Alfa had counter-offered the acquisition of these assets at a higher price. There are no official statements yet, but such a deal looks quite logical for Alpha. Cnews data:

…in addition to Turkey, Turkcell also owns significant assets in the CIS countries. In particular, it owns 51% of Euroasia Telecommunication Holdings, which, in turn, owns 100% of the shares of the Ukrainian Astelit, which recently launched a GSM network under the life:- trademark). In addition, Astelit controls a 99% stake in the dAMPS operator Digital Cellular Networks of Ukraine (DCC). In addition, Turkcell owns 41.45% of the shares of FinTur Holdings, registered in the Netherlands, among whose assets are controlling stakes in a number of leading GSM operators in the CIS: 79.78% of the shares of Azertel, which owns 64.3% of the shares of the Azerbaijani mobile operator Azercell , 51% of the shares of the Kazakh K-Cell (trademark "GSM-Kazakhstan"), 80% of the shares of the Moldovan MoldCell and a controlling stake of the Georgian GeoCell.

In this case, we are interested in the assets of Turkcell in the Ukrainian company Astelit. The DCC operator owned by this company has recently been actively developing the GSM (life) network. Unfortunately, only in the 1800 MHz band, there is no license for 900 MHz. But WellCOM has such a license (but no license for 1800 MHz), so the two networks are "made for each other". However, such an intricate scenario is hardly likely.

Finally, let's not forget about the ongoing legal conflict between the Bermuda offshore IPOC International Growth Fund Ltd and LV Finance, which through its structure "CT-Mobile" controlled 25.1% of the shares of MegaFon and sold these shares to Alfa (according to IPOC - illegally) We wrote about this conflict last year. Judging by some foreign publications, LV Finance may eventually lose numerous lawsuits and Alfa may lose its 25.1% of assets in MegaFon as a result. Indirect confirmation is the behavior of Leonid Mayevsky, who recently left abroad and published his statement about his forced departure from there due to possible harassment by the Russian authorities. However, court battles are slow and will last another six or eight months, and it is high time for MegaFon to go public in order to attract additional capital for the development of the network. Both parties are interested in a speedy peaceful resolution of the conflict, and Alfa's attempt to "steal" a deal on Turkcell assets from TeliaSonera may mean Alfa's desire to create a counterbalance that can be used in the negotiation process. Recall that TeliaSonera owns a 35.6% stake in MegaFon and the deal to acquire a part of Turkcell could well be caused by the desire to bring MegaFon to the Ukrainian market. Thus, Turkcell shares in the hands of Alfa can become a kind of "bargaining chip" in the asset trading of Russian and CIS operators.

Outcome: one can only guess about the further development of events, but a lot will become clear in the next couple of months. It will be extremely interesting to see how many GSM operators are formed in Ukraine as a result. And even more interesting - to whom they will belong and what they will be called. Although, as for the name WellCOM, it may be for the best (see below).

WellCOM: "Urban" network and linguistic study

Our material about VimpelCom's possible acquisition of the WellCOM network caused a lot of feedback. We also received some clarifications from one of the employees of the company.

We quickly corrected the given outdated figures of the WellCOM subscriber base, the trend of 2005 is the outstripping growth in the number of subscribers. The rates are not dumping, however, due to the absence of the notorious "Connection fee" in the Mobi tariff, the operator's prospects are not bad. GPRS has been put into test (free) operation in Kyiv and Kharkov. It's a pity that since November 2004 WellCOM stopped publishing new connection statistics on its website.

Our somewhat sarcastic remarks about the coverage map turned out, unfortunately, to be true. Judging by the responses, the design of the map is not accidental: mainly cities are covered by the network, even most highways are not yet covered by communication. Many now successful operators started with the business model of "urban" coverage - there are an order of magnitude more potential subscribers in cities. Yes, and it is easier to advertise with specific "points of presence" than with abstract square kilometers of covered territories. However, in the near future, it will either have to expand its coverage (significant costs with a relatively small financial return), or remain a deliberately niche "urban" operator. Active expansion seems to be planned: at the next meeting of the company's shareholders, it is planned to consider the issue of attracting new investments by increasing the company's authorized capital by 9.8 times (up to 157.1 million dollars).

Assumptions about the origin of the WellCOM name turned out to be not entirely correct. Quote from a letter received on this subject from a company employee:

For my part, I would like to make some clarifications about the emergence of the name of the company "Wellcom": Initially, Well communications (good communication) was meant. Thank you for your attention.

Such, frankly, an unexpected combination of English words intrigued us and we decided to consult a specialist.

The adverb well (translated as "well") can be combined, for example, with a verb or an adjective. The adverb does not match with a noun. In this combination, the word well is unambiguously treated as a noun used as a definition for the noun communications that follows it. In this case, everything is in order with grammar, the noun well is well known and often used - for example, in the meaning of "well" or "well".
Olga Soboleva, PhD, Associate Professor

Back to news »

Complicated maneuvers of Alpha: do all roads lead to Ukraine?

Alfa-Group's desire to strengthen its positions in the telecommunications market of Ukraine is quite obvious. VimpelCom's (or Alfa's?) recent "demarche" - a demonstration of intentions to acquire the Ukrainian WellCOM - is only one step in a complex multi-way combination. It is not yet clear who will merge / spill with whom, however, events begin to develop at an increasing speed.

Alfa Group's desire to strengthen its position in the Ukrainian telecommunications market is quite obvious. VimpelCom's (or Alfa's?) recent "demarche" - a demonstration of intentions to acquire the Ukrainian WellCOM - is only one step in a complex multi-way combination. Who will merge / spill with whom is not yet clear, however events begin to unfold with increasing speed.

In our report on VimpelCom's signing of an option to acquire 100% of WellCOM's shares, we expressed cautious concerns about Kyivstar's possible problems with the current administration of Ukraine. Literally a few days after the publication, the topic received an unexpected continuation: Alfa-Telecom Holding increased its stake in the Ukrainian company Storm, which owns 43.49% of Kyivstar shares, to 100%. With a very high degree of probability, it can be assumed that Alfa Telecom acquired, among other things, shares owned by people from the entourage of former Ukrainian President Leonid Kuchma. Thus, Kyivstar can be considered delivered from the "burden of the past", and Alfa once again confirmed its interest in the fate of the second largest Ukrainian GSM operator.

The controlling stake in Kyivstar (56.51%) is still owned by the Norwegian company Telenor, which is also one of the main shareholders of VimpelCom (Telenor and Alfa own 26.6% and 32.9% of VimpelCom shares, respectively). Alfa is interested in merging Kyivstar with VimpelCom, but this turn of events does not suit Telenor, since in this case Telenor's share in the merged company will be less than the controlling one. Is the notorious "control" of the Norwegian company really necessary? It is very necessary: ​​today Telenor is consolidating Kyivstar's figures into its financial statements, and with the loss of a controlling stake, it would lose such an opportunity, which would cause a significant deterioration in the financial performance of the Norwegian company. In the same connection, Telenor's dissatisfaction with VimpelCom's possible entry into the Ukrainian market through the acquisition of WellCOM, and the appearance of lawsuits by VimpelCom's "minority shareholder" demanding that the charter be changed so that asset acquisition transactions are approved by a simple (rather than qualified) majority in the Board of Directors. Such a change in the charter would deprive Telenor of the ability to block decisions to acquire the assets of the Ukrainian operator (Telenor representatives occupy four of the nine seats on the VimpelCom Board of Directors).

In this case, we are interested in the assets of Turkcell in the Ukrainian company Astelit. The DCC operator owned by this company has recently been actively developing the GSM (life) network. Unfortunately, only in the 1800 MHz band, there is no license for 900 MHz. But WellCOM has such a license (but no license for 1800 MHz), so the two networks are "made for each other". However, such an intricate scenario is hardly likely.

Finally, let's not forget about the ongoing legal conflict between the Bermuda offshore IPOC International Growth Fund Ltd and LV Finance, which through its structure "CT-Mobile" controlled 25.1% of the shares of MegaFon and sold these shares to Alfa (according to IPOC - illegally) We wrote about this conflict last year. Judging by some foreign publications, LV Finance may eventually lose numerous lawsuits and Alfa may lose its 25.1% of assets in MegaFon as a result. Indirect confirmation is the behavior of Leonid Mayevsky, who recently left abroad and published his statement about his forced departure from there due to possible harassment by the Russian authorities. However, court battles are slow and will last another six or eight months, and it is high time for MegaFon to go public in order to attract additional capital for the development of the network. Both parties are interested in a speedy peaceful resolution of the conflict, and Alfa's attempt to "steal" a deal on Turkcell assets from TeliaSonera may mean Alfa's desire to create a counterbalance that can be used in the negotiation process. Recall that TeliaSonera owns a 35.6% stake in MegaFon and the deal to acquire a part of Turkcell could well be caused by the desire to bring MegaFon to the Ukrainian market. Thus, Turkcell shares in the hands of Alfa can become a kind of "bargaining chip" in the asset trading of Russian and CIS operators.

Summary: one can only guess about the further development of events, but a lot will become clear in the next couple of months. It will be extremely interesting to see how many GSM operators are formed in Ukraine as a result. And even more interesting - to whom they will belong and what they will be called. Although, as for the name WellCOM, maybe it's for the best (see below).

WellCOM: "Urban" network and linguistic study

Our material about VimpelCom's possible acquisition of the WellCOM network caused a lot of feedback. We also received some clarifications from one of the employees of the company.

We quickly corrected the given outdated figures of the WellCOM subscriber base, the trend of 2005 is the outstripping growth in the number of subscribers. The rates are not dumping, however, due to the absence of the notorious "Connection fee" in the Mobi tariff, the operator's prospects are not bad. GPRS has been put into test (free) operation in Kyiv and Kharkov. It's a pity that since November 2004 WellCOM stopped publishing new connection statistics on its website.

Our somewhat sarcastic remarks about the coverage map turned out, unfortunately, to be true. Judging by the responses, the design of the map is not accidental: mainly cities are covered by the network, even most highways are not yet covered by communication. Many now successful operators started with the business model of "urban" coverage - there are an order of magnitude more potential subscribers in cities. Yes, and it is easier to advertise with specific "points of presence" than with abstract square kilometers of covered territories. However, in the near future, it will either have to expand its coverage (significant costs with a relatively small financial return), or remain a deliberately niche "urban" operator. Active expansion seems to be planned: at the next meeting of the company's shareholders, it is planned to consider the issue of attracting new investments by increasing the company's authorized capital by 9.8 times (up to 157.1 million dollars).

Assumptions about the origin of the WellCOM name turned out to be not entirely correct. Quote from a letter received on this subject from a company employee:

For my part, I would like to make some clarifications about the emergence of the name of the company "Wellcom": Initially, Well communications (good communication) was meant. Thank you for your attention.

Such, frankly, an unexpected combination of English words intrigued us and we decided to consult a specialist.

The adverb well (translated as "good") can be combined, for example, with a verb or an adjective. The adverb does not match with a noun. In this combination, the word well is unambiguously treated as a noun used as a definition for the noun communications that follows it. In this case, everything is in order with grammar, the noun well is well known and often used - for example, in the meaning of "well" or "well". Olga Soboleva, Ph.D., Associate Professor