VEON announces the exercise of the Dhabi Group's put option for its 15 per cent of Pakistan Mobile Communications Limited (PMCL)

Rhea-AI Summary

VEON Ltd. announced on Sept. 28, 2020, that its partner in Pakistan, the Dhabi Group, has exercised a put option to sell its 15% stake in PMCL, which operates the Jazz mobile network. Following this transaction, expected to close in Q4 2020 after an independent valuation, VEON will fully own PMCL, enhancing governance and allowing the company to receive full dividends from its operations in Pakistan. The put option is currently recorded as a liability in VEON's accounts, subject to quarterly reappraisal.

Positive

• Achieving 100% ownership of PMCL allows for streamlined governance.
• Full ownership enables VEON to capture all dividends from PMCL.

Negative

• The execution of the put option reflects a liability in VEON's accounts.

AMSTERDAM, Sept. 28, 2020 /PRNewswire/ -- VEON Ltd. (NASDAQ: VEON) (Euronext Amsterdam: VEON), a leading global provider of connectivity and internet services, announces that its partner in Pakistan, the Dhabi Group, has exercised its put option to sell VEON its 15% shareholding in PMCL, the operating company of Pakistan's leading mobile operator, Jazz.

The transaction, which requires independent valuation to determine the fair value of the shareholding, is expected to close in 4Q 2020. Once completed, VEON will own 100% of PMCL and achieve full beneficial ownership of Jazz, allowing it to simplify and streamline governance over its Pakistani assets, as well as capture the full value of dividends paid by PMCL.    

The put option is presently reflected in VEON Group's accounts as a liability over a non-controlling interest, the value of which is reappraised on a quarterly basis.

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, expectations regarding the achievement of the potential benefits of the transactions described above. 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.

Investor Relations
Nik Kershaw 
ir@veon.com
Tel: +31-20-79-77-200

Corporate Communications
Kieran Toohey 
pr@veon.com
Tel: +31-20-79-77-200

 

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SOURCE VEON Ltd

FAQ

What does the put option exercised by Dhabi Group mean for VEON?

The put option allows VEON to acquire full ownership of PMCL, enhancing control and profitability.

When is the transaction for PMCL expected to close?

The transaction is expected to close in the fourth quarter of 2020.

What impact does this transaction have on VEON's financials?

This transaction will allow VEON to receive full dividends from PMCL, improving its financial position.

How does the put option affect VEON's accounting?

The put option is recorded as a liability, affecting VEON's financial accounts until the transaction is finalized.