Sweden’s Tele2 acquires Kazakh’s NEO for $77 million

Sweden's second largest mobile operator, Tele2 AB, has agreed to buy a controlling 51-per cent stake in Kazakhstan's NEO for approximately 550 million kroner ($77 million) in an all-cash deal.

Tele2 will acquire the majority stake in NEO from the Kazakhtelecom, while the remaining 49 per cent is held by Asianet Holdings BV (Asianet), an investment group.

Tele2 will also have the option to acquire Asianet's stake after five years from closing.

Through the acquisition, Tele2 would make a footing in Kazakhstan and plans to further expand its presence in the Commonwealth of Independent States.

NEO operates a 900MHz GSM network in Khazakhstan and has a relatively small market share of 5 per cent, while larger rivals, Sweden's TeliaSonera with its Kcell and Russia's VimpelCom with its Beeline, command 45 per cent of market each.

Tele2 president and CEO Harri Koponen said, ''The acquisition of a mobile operation in Kazakhstan goes hand in hand with our ambition to carefully look for complementary assets in or close to our mobile footprint.''