VEON Ltd. ORD · RUS:VEON-RX
VEON Ltd. ORD — VimpelCom — Merger or Acquisition (November 2015)
16 slides from VEON Ltd. ORD's merger presentation, Nov 26, 2015
Slide 1: Strengthening our leadership position in Pakistan
Strengthening our leadership position in Pakistan © VimpelC om Ltd. 2015 A&I conference call November 26, 2015 Jean-Yves Charlier – VimpelCom CEO Andrew Davies – VimpelCom CFO Gerbrand Nijman – GTH CFO 1
Slide 2: Disclaimer
Disclaimer This presentation contains “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts, and include statements regarding among other things, the expected timing of com
Slide 3: In-market consolidation in Pakistan – executing on strategy
In-market consolidation in Pakistan – executing on strategy 6 1 Structural New revenue improvements streams © VimpelC om Ltd. 2015 World class operations Reinventing 5 VimpelCom 2 Digital leadership Portfolio rationalization Performance and consolidation transformation 4 3 3
Slide 4: Mobilink and Warid to merge, strengthening leadership position in Pakistan
Mobilink and Warid to merge, strengthening leadership position in Pakistan Strengthening leadership position in Investment and innovation Pakistan • Enlarged and improved mobile network with over 80% population coverage (2G) • Largest combined footprint and customer base of 45 million • Accelerated
Slide 5: Transaction rationale
Transaction rationale A leading operator in Pakistan telecom market + - © VimpelC om Ltd. 2015 Superior Best-in-class New revenue Cost customer mobile opportunities synergies experience network 5
Slide 6: A leading operator in the Pakistan telecoms market
A leading operator in the Pakistan telecoms market A leading mobile operator Mobilink holds the number 1 market position (Mobile customer market share1 ) (Market share1 based on customers) 29% 38% 27% Market 27% 19% position 19% 16% 16% 9% © VimpelC om Ltd. 2015 Mobilink + Telenor Zong Ufone 2011 20
Slide 7: Superior customer experience
Superior customer experience • Best coverage of over 80% population by 2G © VimpelC om Ltd. 2015 • High quality of customer services • Simple and transparent pricing • Enhanced service delivery through • To become #1 in NPS ranking, digital platform leveraging from the current solid position: ► Mobi
Slide 8: New revenue opportunities
New revenue opportunities + Digital & MFS leader: Owning and winning in the High • Mobilink the fastest growing MFS Value and the B2B segments: player in the market © VimpelC om Ltd. 2015 ► Mobilink MFS revenue 2.7% of total • Leading position in high-value ► 2.5 million Mobilink MFS customers and p
Slide 9: Best-in-class mobile network
Best-in-class mobile network • Our plan is to enhance network capacity and quality of service • Targeted network investments in © VimpelC om Ltd. 2015 quality and coverage • Network consolidation through migration of customers and integration of network elements • Decommissioning of overlapping site
Slide 10: Identified cost synergies - total run-rate of USD mln
Identified cost synergies - total run-rate of USD 115 mln1 - Market facing • Integrated customer service & customer operations • Efficient channel and distribution model Synergies run rate (USD million) 115 © VimpelC om Ltd. 2015 • Site decommissioning Capex c. 25% Network & IT • Common IT platforms
Slide 11: Enhanced profitability and cash generation
Enhanced profitability and cash generation An operator with USD 1.4bn revenue EBITDA margin of 42% (USD mln, LTM Sept 2015) (USD mln, LTM Sept 2015 and % margin) 357 1,366 7pp 42% 35% 1,009 Revenue 569 483 and EBITDA © VimpelC om Ltd. 2015 Mobilink Warid pro forma MergeCo pro forma 1 Mobilink Warid
Slide 12: Key transaction terms
Key transaction terms • VIP/GTH, though PMCL Mobilink, acquires 100% of the shares of Warid Telecom in exchange for the Dhabi Group shareholders receiving approximately 15% of the shares of PMCL Mobilink • No cash contributions expected from VimpelCom/GTH or the Dhabi Group shareholders • Conditiona
Slide 13: Transaction structure
Transaction structure Step 1 – share acquisition Step 2 – legal merger VimpelCom VimpelCom 51.9% 51.9% © VimpelC om Ltd. 2015 GTH GTH ~85% ~85% ~15% ~15% PMCL Dhabi Group PMCL Dhabi Group Mobilink shareholders Mobilink shareholders 100% Warid Telecom Closing 6 months after announcement Merger 6 mont
Slide 14: Summary
Summary In-market optimization Algeria Italy JV Pakistan transaction transaction © VimpelC om Ltd. 2015 September October January March August November 2014 2014 2015 2015 2015 2015 WIND Canada Telecel Globe Limited Zimbabwe Italy tower sale disposal CAR and Burundi disposal disposal Portfolio ratio
Slide 15: Q&A
4 2 8 . § 5 Q 3 8 £ > ® Global Telecom = VimpelCom Folding
Slide 16: VimpelCom/GTH accounting implications
VimpelCom/GTH accounting implications Upon closing of the share acquisition • The acquisition of Warid will be accounted for as a business combination under IFRS • The fair value of Warid’s assets and liabilities will be taken over into the VimpelCom/GTH consolidated balance sheet as of the date of