MTS zeroed out the cost of the remaining part of the earn-out for the sale of Ukrainian business for 1.8 billion rubles

Part of the remuneration provided for by the deal for the sale of the Ukrainian business of MTS in 2019 did not reach the company. This follows from the data of the interim consolidated financial statements of MTS for six months, it is placed on link.

In November 2019, the MTS Group signed an agreement on the sale of its subsidiary Preludium BV, which owned 100% in the authorized capital of PrJSC VF Ukraine (Vodafone Ukraine) and its subsidiaries, which operated the group in Ukraine. The transaction was completed on December 3, 2019.

In accordance with the terms of the agreement, depending on the results of the discontinued work in Ukraine, the group was to receive additional contingent consideration. The Group received the first payment in March 2021 in the amount of RUB 1.2 billion. The fair value of the contingent consideration recognized as at 31 December 2021 was RUB 1.8 billion.

“As of June 30, 2022, due to the significant uncertainty associated with the receipt of remuneration due to political and economic instability and sanctions in Russia, the group recognized a provision for the full amount of remuneration and its value was nil,” the document says.

The parent company of Vodafone Ukraine – Preludium BV, the ultimate beneficiary – NEQSOL Holding, follows from open sources.

MTS Group signed an agreement on the sale of its business in Ukraine – the operator “VF Ukraine” – to the Azerbaijani operator Bakcell, at the end of 2019. As a result of the transaction, the company was to receive $734 million.

Maria Fedotova