Bloomberg News

VTB Names Ex-Rostelecom’s Alexander Provotorov Tele2 Russia CEO

May 29, 2013

Tele2 Russia, the country’s fourth-largest wireless operator, named former OAO Rostelecom head Alexander Provotorov as chief executive officer, less than two months after VTB Group acquired the company for $3.6 billion.

Provotorov takes over from Jere Calmes, who was appointed by Stockholm-based Tele2 AB (TEL2B) in February to head the Russian unit. Calmes will be first deputy CEO, in charge of operations, VTB said today in a statement.

Tele2 sold the unit to state-run lender VTB even as operators VimpelCom Ltd (VIP:US) and OAO Mobile TeleSystems (MBT:US) were offering a higher price. Provotorov was replaced as Rostelecom CEO by the government in March. He previously worked for Marshall Capital LLC, a 10.7 percent shareholder in Rostelecom.

“This is an unexpected twist, especially given that VTB and Marshall Capital have a history of tense relations,” Anna Lepetukhina, an analyst at Sberbank Investment Research, said in a note. In February, VTB lost a bid to have a fraud lawsuit involving Marshall Capital owner Konstantin Malofeev heard in London, where a court discharged an order that had frozen his assets.

“Provotorov has always advocated that the logical path for Rostelecom is to strengthen its position in the mobile business” and has supported a merger of Rostelecom and Tele2 Russia, Lepetukhina wrote. Rostelecom remains the most obvious candidate for an acquisition of Tele2 Russia, while “the ultimate outcome could be anything at this point,” she said.

To contact the reporter on this story: Ilya Khrennikov in Moscow at ikhrennikov@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net


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Companies Mentioned

  • VIP
    (VimpelCom Ltd)
    • $9.0 USD
    • 0.71
    • 7.89%
  • MBT
    (Mobile Telesystems OJSC)
    • $17.1 USD
    • 1.35
    • 7.89%
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