Significant events after year-end 2017

On December 18, 2017, Telia Company announced that it had acquired the Finnish ICT company Inmics Oy at an enterprise value of EUR 75 million on a cash and debt free basis. The acquisition of Inmics Oy was subject to approval from the Finnish Competition and Consumer Authority. Approval was received in January 2018 and the transaction is expected to be closed in the first quarter of 2018. For more information, see Note C33 “Business combinations”.

On January 26, 2018, Telia Company announced that Fintur Holdings B.V. (Fintur), jointly owned by Telia Company and Turkcell, had signed an agreement to dispose 100 percent of its holding in Geocell LLC, to the Georgian telecommunications company JSC Silknet, Georgia’s largest fixed network operator, for a transaction price of USD 153 million. The transaction is subject to regulatory approvals.

In February 2018 Telia Company signed an agreement to dispose its holding in the associated company TOO Rodnik in Kazakhstan which Telia consolidates to 50 percent. Rodnik owns the listed company AO KazTransCom.

On March 5, 2018 Fintur Holdings B.V. (Fintur), jointly owned by Telia Company (58.55 percent) and Turkcell (41.45 percent), signed an agreement to sell its 51.3 percent holding in Azertel Telekommunikasyon Yatirim Diş Ticaret A.Ş (Azertel) to Azerbaijan International Telecom LLC (Azintelecom), wholly-owned company by the Republic of Azerbaijan. The transaction was not subject to any conditions, such as regulatory or competition approvals, and was completed on the same date. Azertel is sole shareholder of the leading Azeri mobile operator Azercell LLC (Azercell). The agreed price for Fintur’s 51.3 percent in Azertel is EUR 222 million, which implies an equity value of EUR 432 million for 100 percent of Azercell and an enterprise value of EUR 197 million on a cash and debt free basis. The price corresponds to an EV/EBITDA multiple of 2.1x based on 2017. In addition to the impairment of SEK 2.6 billion recognized in December 2017, accumulated foreign exchange losses of SEK 3.0 billion will be reclassified to net income from discontinued operations, but will have no material effect on group equity. The transaction is on a pro forma basis estimated to increase net debt to EBITDA by approximately 0.1x. The final amounts are subject to changes in carrying values and foreign exchange rates. Prior to signing the transaction, Telia Company completed strict compliance and purchaser due diligence and is satisfied that all relevant checks and controls have been carried out with satisfactory results. Azintelecom is a buyer in line with Telia Company’s requirements as it is a company wholly owned by the sovereign state of Azerbaijan.