Access Evolution

What’s up with… Vodafone Spain, AIS, Kyivstar

By TelecomTV Staff

Jul 17, 2024

  • Vodafone Spain’s new owner strikes job cuts deal
  • Thailand’s AIS to be merged with energy firm
  • Kyivstar bolsters its alternative power infrastructure 

In today’s industry news roundup: Spanish unions strike a deal with Zegona, Vodafone Spain’s new owner, regarding a headcount reduction; Thai mobile operator AIS is to be merged with its largest shareholder; Veon’s Kyivstar is investing heavily in generators and batteries as Ukraine’s energy network comes under attack by Russia; and much more!

Zegona Communications, the new owner of Vodafone Spain following the €5bn deal that concluded in late May, has struck a workforce reduction agreement with the Spanish trade unions, including the UGT, that will result in 898 Vodafone Spain staff being made redundant, Europa Press has reported, citing sources from UGT. Shortly after concluding its takeover, Zegona put forward a plan to cut the Vodafone Spain workforce by 1,198, about a third of the operator’s total workforce, but now the company and unions have reached an agreement that saves 300 of those roles and will result in improved redundancy payments for the affected staff. The news comes just days after Zegona announced the refinancing of the funds it borrowed to make the Vodafone Spain acquisition. Zegona’s CEO, Eamonn O’Hare, stated: “With Zegona’s long-term financing now secured, we have a capital structure that is fit for purpose and we can now focus on the continued execution of our strategic plans to improve Vodafone Spain, driving growth and creating value for all stakeholders.”  

Intouch Holdings, the parent company of Thailand’s second-largest mobile operator AIS (Advanced Info Service), is to merge with its largest shareholder, Gulf Energy Development, to form a new integrated company valued at more than $20bn that will have a simplified structure, greater scale and be better able to expand its operations in the digital services and renewable energy sectors. Both companies are controlled by Thai billionaire Sarath Ratanavadi, who stated that the new entity’s “combined expertise will benefit both companies and all stakeholders, increasing the potential of the new company to be a leader in the energy and telecommunications business.” Currently, Gulf Energy Development holds a 47.4% stake in Intouch, while regional telecom powerhouse Singtel holds a 24.99% stake. Following the merger of Intouch and Gulf, Singtel, which supports the merger move, will hold a 9% stake in the combined company: It will also receive proceeds of about 400m Singapore dollars (US$298m) from the merger transaction. Singtel’s CFO, Arthur Lang, noted in this statement: “For some years now, Singtel and Gulf, as major shareholders of Intouch, have been working to streamline the diversified holding structure of Intouch. We believe it is in the best interests of stakeholders to simplify AIS’ shareholding structure and are supportive of this move. We have always preferred to hold direct stakes in our associates and this amalgamation is a step in the right direction.” The full financial details of the proposed merger can be viewed in this 92-page document.      

Kyivstar, the subsidiary of Veon in Ukraine, is to deploy an additional 848 stationary industrial generators and 61,766 new batteries to support the business continuity of the operator’s network during extended blackouts caused by Russian attacks on the country’s energy infrastructure. The operator argued that energy resilience has been the centrepiece of its investment focus from the outset of the Russian conflict and, so far, the company has deployed 2,322 generators and 115,000 four-hour duration batteries at base stations to provide backup power during blackouts. Oleksandr Komarov, CEO of Kyivstar, explained that the telco has invested more than US$24m over the past two years to improve its energy resilience. “However, the changing nature of threats to Ukraine’s energy infrastructure and extended blackouts now necessitate a reinforcement in our strategy. This second wave of focus on energy resilience will enable Kyivstar to support critical connectivity with even further resources dedicated to energy resilience,” he added. In June, Veon announced plans to increase its investment in the recovery of Ukraine’s digital infrastructure to US$1bn between 2023 and 2027, up from the $600m it announced a year ago.

Malaysia’s U Mobile is set to reject any takeover offer it receives from rival service provider Maxis and press ahead with plans for an IPO, according to a report from Bloomberg. Maxis is believed to be exploring a potential acquisition offer for U Mobile, which has more than 9 million customers, but Malaysian businessman Vincent Tan, a major shareholder in U Mobile, told Bloomberg that any offer from Maxis would be rejected and that “we are submitting for an IPO at the end of this month.”

A1 Telekom Austria Group has reported a 3.9% year-on-year increase in second-quarter service revenues to just over €1.12bn across its multiple central and eastern European markets and a 1.3% increase in total revenues to just over €1.3bn, though its operating profit dipped by 9.3% to €218m due to a near 17% increase in depreciation, amortisation and impairment charges. The group ended June with 25.9 million mobile connections across all of its operations, up by 6% year on year, and almost 6.3 million RGUs (revenue generating units) for fixed line services such as broadband and voice lines. The company has operations in Austria (its main market), Bulgaria, Croatia, Belarus, Slovenia, Serbia and North Macedonia. In line with many other operators, A1 spent much less on capex in the second quarter – €247m compared with €359m in the second quarter of 2023 – though this was mainly due to lower spectrum investments. “We again saw a solid development in the second quarter,” stated Alejandro Plater, CEO of A1 Group. “Group service revenues increased by 3.9 %. The growth was strongly driven by eastern European markets… Despite a challenging environment in the Austrian market, we pursued our strategy in staying relevant for our customers resulting in a solid growth performance in the second quarter,” added the CEO. The news came as A1’s parent company, América Móvil, reported solid growth for the second quarter of this year – see América Móvil gets bigger and stronger.

Tele2 has reported a slight improvement in its financials for the second quarter, with its total revenue rising by 1% year on year to 7.3bn Swedish krona (SEK) (US$693.5m) in the period. End-user service revenue rose by 4% to SEK 5.5bn ($522.5m) driven by “solid performance” in the consumer segment of its domestic market of Sweden, as well in the Baltics. “It feels good to summarise Tele2’s second quarter as one of good progress and solid financial performance. We deliver our thirteenth consecutive quarter of top-line growth,” noted Tele2’s president and group CEO, Kjell Johnsen. He added that the operator is gradually leaving behind “the most challenging economic period for Swedish consumers”, but that it is “still very much here and now for Swedish businesses”. “In that context, Sweden business is doing well in a market influenced by a record number of bankruptcies and a slowdown of the overall economy. We are positive that trends within B2B can improve further when the overall economy builds speed within a couple of quarters,” added Johnsen. In terms of its other markets, Tele2’s chief highlighted continuous good results in Lithuania, and pointed out that Latvia is getting back to growth after being in between pricing cycles in the first half of 2024. Meanwhile, Estonia is in the middle of a turnaround and “we expect improvements during the second half of the year,” he stated. Read more.

Virgin Media O2 (VMO2) is poised to deliver connectivity at major events and holiday spots across the UK, having just announced plans to deploy sustainable temporary masts at 29 festivals and special events, and at 12 popular ‘staycation’ destinations this summer. The so-called cells on wheels (COWs) are provisional masts designed to deliver consistent mobile coverage in areas with a surge in visitors, such as festivals and other events. The UK telco said the COWs are its “greenest yet” as they will be powered by a sustainable hydrotreated vegetable oil (HVO) solution. It estimates that switching to this source of power will help it save the equivalent of 300 tonnes of carbon dioxide.

- The staff, TelecomTV

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