Kyivstar CEO Oleksandr Komarov on Nasdaq debut, Ukraine telecom business and impact of war

Key Concepts:

• Kyivstar's Nasdaq listing via SPAC
• Impact of the war in Ukraine on business operations
• Kyivstar's transition to a digital service operator
• Starlink's role in Ukrainian national security
• Investment in the Ukrainian economy
• Importance of international business cooperation

1. Kyivstar's Nasdaq Listing and its Significance:

• Kyivstar, a Ukrainian company, debuted on the Nasdaq via a SPAC, marking the first time a Ukrainian company has gone public on a US exchange.
• Oleksandr Komarov, Kyivstar's CEO, emphasized the listing as a major event for the Ukrainian economy and the company itself.
• Despite the ongoing war, the listing demonstrates the country's ability to develop under difficult circumstances.
• The direct listing of the holding group aimed to unlock value for shareholders, and the company's value has grown by approximately 20% since the listing.
• The low redemption rate achieved through the SPAC process further validates the decision to list.

2. Operational Challenges and Adaptations During the War:

• Kyivstar exclusively services territories under Ukrainian control.
• The company focuses on being a digital service operator rather than a pure telco provider.
• Kyivstar is a market leader in mobile telco and fixed broadband.
• The company is developing digital services in areas like digital health, ride-hailing, and entertainment.
• Kyivstar has access to half of Ukrainian households with its fixed broadband infrastructure and 98% population coverage with LTE technology.

3. Starlink Partnership and its Strategic Importance:

• Starlink is considered an essential element of Ukrainian national security.
• The partnership will enable Kyivstar to cover 100% of the territory with OTT messaging and mobile broadband services through satellite.
• Direct-to-cell services will strengthen both the humanitarian and security aspects of the telco services provided to customers.

4. Business Strategy and Investment:

• Kyivstar is focused on running and developing its business despite the ongoing war.
• The company has demonstrated gross marginality throughout the full-scale war.
• Kyivstar has committed to investing 1 billion USD into the Ukrainian economy from 2023 to 2027 and is making progress towards this goal.

5. Rationale for Listing on Nasdaq:

• Veon, Kyivstar's parent company, is already listed on Nasdaq.
• Special conditions exist between Nasdaq and the Ukrainian government.
• Kyivstar is the first Ukrainian entity to be listed on the American Stock Exchange.

6. The Role of International Business Cooperation:

• Listing on US exchanges can help strengthen security, cultural, and business cooperation between Ukraine and the West.
• The Ukrainian American Chamber of Commerce is strong due to the presence of American businesses in Ukraine.

7. Notable Quotes:

• Oleksandr Komarov: "We are moving, we are developing. So we are going ahead despite a very difficult circumstances. And this is a kind of proof that country can develop in a very, very difficult circumstances."
• Oleksandr Komarov: "Starlink is essential element of the Ukrainian national security for the time being."

8. Technical Terms and Concepts:

• SPAC (Special Purpose Acquisition Company): A company with no commercial operations that is formed strictly to raise capital through an initial public offering (IPO) for the purpose of acquiring an existing company.
• OTT (Over-The-Top) Messaging: Delivery of messaging services over the internet without requiring a traditional telecommunications provider.
• LTE (Long-Term Evolution): A standard for wireless broadband communication for mobile devices and data terminals.
• Digital Service Operator: A company that provides a range of digital services, such as mobile, broadband, digital health, ride-hailing, and entertainment, often bundled together.

9. Synthesis/Conclusion:

Kyivstar's Nasdaq listing represents a significant milestone for the Ukrainian economy, demonstrating resilience and potential for growth despite the ongoing war. The company's strategic focus on becoming a digital service operator, its partnership with Starlink, and its commitment to investing in the Ukrainian economy highlight its adaptability and long-term vision. The decision to list on Nasdaq was driven by factors including the parent company's existing listing, special conditions between Nasdaq and the Ukrainian government, and the desire to strengthen international business cooperation.