Telenor

Telenor Group — the international operator of mobile services, Internet access and TV broadcasting. Telenor Group locates networks of mobile communication in 12 countries of Scandinavia, Central and Eastern Europe and Asia and also owns 42.95% of voting shares (33% of capital stock) of the VimpelCom Ltd. company working in 17 countries. The main office of the company is in Norway.

Performance Indicators

2013

In 2013 Telenor expects growth of revenue at the level of 3-5% and profitability on EBITDA at the level of 34%. The company also has an opportunity to increase investment volume for gain of the market position, assuming that the capital investments will make 12-14% of revenue. 161 million subscribers for the III quarter 2013.

In the third quarter 2013 revenue of Telenor Group made 26.0 billion Norwegian kroner that corresponds to organic growth by 1%. The indicator of EBITDA before accounting of other income and expenses made 9.6 billion Norwegian kroner; profitability of EBITDA — 37%, and a cash flow from operations — 5.9 billion Norwegian kroner. Net profit was 3.9 billion Norwegian kroner taking into account mostly non-monetary negative exchange differences in the amount of 502 million kroner.

The net profit of the Norwegian telecommunication giant Telenor ASA at the end of 2013 was 13.2 billion kroner (2.03 billion dollars) that for 50% exceeds an indicator of 2012. Net profit in terms of the ordinary share was 8.65 kroner (1.33 dollars) against 5.62 kroner for 2012. Revenue of the company increased by 2.3% — to 104 billion kroner (16 billion dollars).

2012

In the fourth quarter 2012 revenue of Telenor Group made 26.0 billion Norwegian kroner. The indicator of EBITDA equaled 8.2 billion Norwegian kroner, profitability of EBITDA – 31.5%. A cash flow from operations – 4.6 billion Norwegian kroner.

Total revenue of Telenor for all 2012 made 101.7 billion Norwegian kroner (in 2011 – 98.5 billion), EBITDA – 32.8 billion Norwegian kroner (2011 – 30.5 billion), profitability of EBITDA – 32.2%, a cash flow from operations – 20.5 billion Norwegian kroner (2011 – 19 billion).

Other financial results are as follows: the corrected operating profit in 2012 was 18.4 billion Norwegian kroner (in 2011 – 15.2 billion), the capital investments - 21,511 million Norwegian kroner (in 2011 – 11,907 million). Without the cost accounting on licenses and a range the capital investments of Telenor in 2012 equaled 12,299 million Norwegian kroner.

2011

Total revenue of Telenor for 2011 made 98.5 billion Norwegian kroner, an indicator of EBITDA — 30.5 billion Norwegian kroner, profitability of EBITDA — 31%, and a cash flow from operations — 19.1 billion Norwegian kroner. 130 million subscribers in 11 countries of the world (September, 2011)

Organizational structure

In September, 2011 Telenor announced intention to strengthen the position in the telecommunication market by means of changes in the organization structure^[1].

The top management

"For ensuring our organizational readiness for the solution of assigned tasks the decision to make three key appointments in the top management of Group is made: To Hilda Tonna will direct work on industrialization in all markets and in all regions of our business, Christine Skogen Lund will be engaged in innovations and development of the new directions of business, and Berit Svendsen will head strategically important domestic market of Norway", Jón Fredrik Baksaas noted.

For the purpose of reduction of the organization in compliance with this strategy it was also decided to include at this stage of the CEO of Telenor Norway company in the structure of the top management of group, considering the exclusive provision Telenor in Norway and interaction between the management of group and division. Svendsen takes will hold a position of the executive vice president and CEO of Telenor Norway company who will submit to the CEO of Telenor Group.

Division of digital services

Telenor will pay more attention to ensuring constantly available (always-on) services at the expense of innovations in the field of Internet technologies. Therefore the company establishes department of digital services which the executive vice president Christine Skogen will head Lund.

Division of industrial development

Besides, Telenor will stimulate industrialization and to raise standards of business. For the last decade Telenor created one of the largest customer bases in the world. By means of upgrade of the enterprises in all markets and gains of interaction of all divisions of the Telenor group is going to increase service quality of mobile communication which it provides 130 million subscribers in 11 countries. The department of industrial development of the Telenor group which will be headed by the executive vice president to Hilda Tonna will be founded.

"Organizational changes are necessary in order that the Telenor company could create more innovations, use ample opportunities more effectively and overcome the difficulties arising in the field of telecommunications. Thanks to our professional knowledge and unique positions we aim to stimulate further all staff of Telenor Group worldwide. The main value of our company are people therefore our strategic task – to give to all our employees an opportunity to prove – as in local market, and on a global scale" - says Jón Fredrik Baksaas, the president and the CEO of Telenor Group.

Division of corporate development

"We already actively work in this direction. The department of corporate development of Telenor headed by Morten Carlsen of Serbia for three years developed the platform for global innovations and industrialization. Today's organizational changes will even more strengthen results of this work" - Jón Fredrik Baksaas told.

Division of corporate strategy and legal regulation

In addition, there will be a new division – department of corporate strategy and legal regulation which will submit to the CEO of Telenor Group. This department will be headed by Morten Carlsen of Serbia who will remain the member of the top management of group. Divisions of Telenor in Denmark and Sweden and also Telenor Broadcast, Christine Skogen Lund will still direct.

The former CEO of Telenor Norway Ragnar Korkhus will direct the international projects in new department of industrial development of Group.

Business in Serbia

In Serbia Telenor services 3.059 million people (July, 2011). In four years Telenor built the national network covering 250 cities and upgraded it to level 3G, having provided support of services of the broadband Internet in the majority of regions of the country.

History

2012

In 2012 Telenor was succeeded to purchase licenses for services 3G in Thailand. In India the company works in six states. If at an auction in March of the current year Telenor purchases one more license, then will develop the activity in the seventh state of India.

The company in 2012 saved high profitability in the markets of Asia. "The popularity of smartphones and data services grows in Thailand and Malaysia, and in Pakistan operational efficiency steadily increases", - Ole Bjorn noted.

In 2012 Telenor was succeeded to recover the positions in VimpelCom. The company intends to give further active support to the operator and to participate in formation of its strategic priorities.

2014: Telenor and TeliaSonera integrate operational divisions in Denmark

On December 3, 2014 the companies Telenor also TeliaSonera signed the merger agreement of operational divisions in Denmark and creation of new joint venture. Each of the companies will own 50% of stocks. It will allow to create strong mobile operator who will increase investments into networks for the benefit of our clients.

The new company will have an integrated subscriber base numbering about 3.5 million people. The transaction will allow to create the steady operator with the general share in mobile communications market in 40%, income more than 9 billion Danish kroner and the considerable potential created due to synergy.

Need of consolidation in the Danish telecommunication market was obvious already for some time as operators faced the long pressure upon revenue and profitability of the companies. It limited opportunities for investments and innovations. Telenor and TeliaSonera companies cooperate since 2012, jointly owning a mobile network in Denmark. Now the parties compounded that creation of independent and full-function joint venture is strategically priority way to achievement of synergy and creation of additional value.

The purpose of merge of two operational divisions is annual increase in efficiency in the amount of more than 800 million Danish kroner, the maximum effect of which should be by 2019. The greatest effect of synergy will be gained by the following spheres: distribution, sales and marketing, call centers, total and administrative expenses, networks and IT. It is expected that costs for integration will be within 0.8 billion Danish kroner during the period from 2015 to 2017.

Larger distribution network will be created, connectivities to network and performance are improved. Besides, as a result of merge the joint venture will fall into more advantage to invest in attractive and convenient services in use. Consolidation of the fixed networks and services of two companies will create even more effective service provider of broadband access for the Danish consumers and the companies.

"In Denmark strong competition, and we face the long pressure upon growth of revenue and profitability that does inevitable consolidation of two divisions. Having merged in itself assets and customer bases of Telenor and TeliaSonera companies in Denmark, the joint venture will become strong operator. We will be able to offer our clients high-quality network with excellent connectivities and higher quality of customer service in Denmark", - the Executive vice president for operations in Europe of Telenor company Shell Morten Jönsson says.

"We take a necessary and natural step, creating joint venture with Telenor on the basis of already existing network partnership. Having combined efforts, we will be able to attract investments into Denmark in interests not only our clients, but also the Danish society in general", - the Executive vice president and the head of TeliaSonera in Europe Robert Andersson says.

Management structure

The Board of new joint venture equally will include representatives of Telenor and TeliaSonera: only seven people, on three from each party, and the Chairman of the board who is selected unanimously by agents of the parties.

Search of the candidate for a position of the CEO of joint venture already goes, both companies are sure that they will be able soon to select the suitable candidate for this position.

Cost

Telenor and TeliaSonera agreed that their enterprises and the corresponding transactions have equal value, therefore, the agreement is based on equal ownership. The difference in net debt and changes of working capital from the moment of agreement signature before its termination will have monetary value. Terms

Telenor and TeliaSonera discussed transaction validity periods. Carrying out this transaction requires approval of European Commission. The parties expect the consent of the European Union and intend to close the deal during 2015. Transactions take place separately and work independently of each other up to completion of the transaction.

2019: An exit from the capital of Veon

In November, 2019 Norwegian the telecom holding Telenor finally left Veon, VimpelCom parent company. Norwegians sold the remained 157 million shares (8.9%) of the company. Transaction amount was about $362 million, said in the statement of Telenor on the stock exchange in Oslo.

At the same time news did not inspire investors: the stocks Veon trade for 2% below of the yesterday's price — $2.44 apiece on closing of the 21st against $2.40 for paper today. According to the estimates of "Non-numerical economy" Norwegians sold shares from 6% discount — approximately for $2.30 for paper.

Telenor within several years gradually leaves the capital of Veon. The Norwegian operator announced intention to sell all the packet in the fall of 2015 when it possessed 33% of the capital of the company.

In 2016 Telenor sold 163.9 million ADS holding, having lowered a share in Veon to 23.7%.

In April, 2017 the operator implemented 4% of stocks for $262.5 million, as a result of the transaction the share was reduced to 19.7%.

In September, 2017 the Norwegian company sold 90 million ADS Veon for $365 million, having lowered a share to 14.7% of Veon.

In March, 2019 Telenor announced sale of another 5.7%.