VEON and Kyivstar set in motion their 600m USD investment plan with Kyiv visit, Mike Pompeo joins the delegation
- VEON and Kyivstar have initiated the 600 million USD investment commitment in Ukraine, aiming to improve the investment climate and support the flow of international business.
- Former U.S. Secretary of State Michael R. Pompeo joined the delegation, visiting Kyiv for the first time after joining Kyivstar as a Board member in November 2023.
- Kyivstar invested roughly 174m USD in capex in 2023 and plans to increase its future investment commitment to 1 billion USD in 5 years.
- VEON is the parent company and the 100% owner of Kyivstar, serving 24 million customers with mobile and fixed connectivity and digital services in Ukraine.
- None.
Insights
The strategic investment of VEON in Ukraine signifies a pivotal move for the company, especially following its exit from the Russian market. The commitment of 600 million USD over a three-year period, with potential expansion to 1 billion USD in five years, underscores a substantial capital expenditure (capex) that could bolster VEON's long-term growth prospects. This investment is poised to enhance the company's infrastructure and service offerings, which could translate into increased market share and revenue in a recovering Ukrainian economy. For investors, the success of this initiative hinges on the stability of Ukraine's economic and political climate, as well as the effective deployment of these funds towards growth-oriented projects.
VEON's investment in Ukraine, particularly in the telecommunications sector, is a strategic move that aligns with the increasing demand for digital connectivity and services. As Kyivstar is already the largest telecom operator in the country, this investment could further solidify its market dominance. The 'B2U: Business to Ukraine' forum co-hosted by VEON and Kyivstar serves as a catalyst for improving the investment climate and can attract additional international business, potentially leading to a multiplier effect on the economy. This could result in a virtuous cycle, where improved infrastructure attracts more business, which in turn drives demand for digital services, creating a positive feedback loop for VEON's operations in Ukraine.
The macroeconomic implications of VEON's investment are multifaceted. On one hand, the influx of capital into Ukraine's telecom sector could stimulate job creation, technological advancements and contribute to the overall economic resilience of the nation. On the other hand, such a large-scale investment carries risks, particularly in a country facing significant geopolitical challenges. The presence of former U.S. Secretary of State Michael R. Pompeo on the Kyivstar Board could be seen as a strategic move to navigate the complex political landscape. Investors should monitor the effectiveness of these investments in fostering a stable and conducive business environment, which is essential for VEON's sustained profitability and growth in the region.
Kyiv, 5 February 2024 – VEON Ltd. (NASDAQ: VEON, Euronext Amsterdam: VEON), a global digital operator that provides converged connectivity and online services, and its wholly-owned subsidiary Kyivstar announce that they have now officially started the implementation of the 600 million USD investment commitment in rebuilding Ukraine, as initially announced in June 2023. VEON’s commitment to invest in Ukraine, including the 600 million USD plan that covers the three-year period from 2024-2026, was the focus of a visit last week by a high-level delegation to Kyiv. Former U.S. Secretary of State Michael R. Pompeo joined the delegation, visiting Kyiv for the first time after joining Kyivstar as a Board member in November 2023.
Following up on their “Invest in Ukraine, NOW!” campaign, VEON and Kyivstar have also co-hosted “B2U: Business to Ukraine”, a business and investment forum in Kyiv. During the Forum, more than 100 representatives of Ukraine’s leading businesses held discussions on improving the investment climate in the country, which is expected in turn to support the flow of international business to Ukraine, contributing to the country’s economic resilience.
Kyivstar, the country’s largest telecommunications company and one of the highest taxpayers, invested roughly 174m USD in capex in 2023, and expects to widen the scope of its future investment commitment from 600m USD in 3 years to 1 billion USD in 5 years, if market conditions permit.
“I am excited to be back in Kyiv, now as part of the VEON family in my role on the Board of Directors of Kyivstar. Ukraine must win this war, both on the battlefield and economically. The private sector, especially international investors, has a crucial role to play to ensure this victory, which I believe is understood and appreciated by all stakeholders. I am inspired to see the incredible dedication of VEON and Kyivstar, and of the other private sector companies that continue to serve Ukrainians with commitment and perseverance,” said Mike Pompeo, Former U.S. Secretary of State and Kyivstar Board member.
“In the first days of the war, we at VEON made a decision and chose to serve Ukraine. I would like to thank our international investors for supporting us through our exit from Russia, which we completed in October 2023, and our continued focus on investing in Ukraine, including the 600 million USD commitment which we are setting in motion starting with this year. VEON and Kyivstar will be a part of Ukraine’s future, and we will continue to work day and night to make the future victorious, successful and inspiring.” said Kaan Terzioglu, VEON Group CEO.
“This year marks the beginning of an ambitious journey for Kyivstar, as we launch the investments within the scope of our three-year commitment to invest 600 million USD. With the support of our parent company VEON, the guidance of Kyivstar Board of Directors, which is now stronger than ever with Secretary Pompeo, the unwavering dedication of our 4000-strong team, and the continued appreciation of our 24 million customers, Kyivstar is a leading example of a company that rises to the challenge of rebuilding Ukraine today – overcoming all odds and never losing the focus,” said Oleksandr Komarov, Kyivstar CEO.
VEON is the parent company and the
Disclaimer
This release contains “forward-looking statements,” as the phrase is defined in Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. Forward-looking statements are not historical facts, and include statements relating to, among other things, VEON’s investment plans. Forward-looking statements are inherently subject to risks and uncertainties, many of which VEON cannot predict with accuracy and some of which VEON might not even anticipate. The forward-looking statements contained in this release speak only as of the date of this release. VEON does not undertake to publicly update, except as required by U.S. federal securities laws, any forward-looking statement to reflect events or circumstances after such dates or to reflect the occurrence of unanticipated events.
Contact Information
VEON
Hande Asik
Group Director of Communication
pr@veon.com
TUVA Partners
Julian Tanner
julian.tanner@tuvapartners.com
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