Russian telecom company leaving Uzbekistan

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TASHKENT (TCA) — Mobile TeleSystems (MTS), the leading telecommunications provider in Russia, will sell its stake in its joint venture in Uzbekistan and leave the Central Asian country.

MTS on August 5 announced that it has sold its 50.01% stake in the telecommunications operator Universal Mobile Systems (UMS) to the State Unitary Enterprise Centre of Radio Communication, Radio Broadcasting and Television of the Ministry of Development of Information Technologies and Communications of Uzbekistan.

MTS quoted its Vice President and Director of the Foreign Subsidiaries business unit, Andrei Smelkov, as saying that MTS had decided to sell its stake in UMS “due to a variety of business reasons and other circumstances.”

On September 23, 2014, MTS received 50.01% of the share capital of UMS at no cost. The remaining 49.99% of UMS was owned by the State Unitary Enterprise Centre of Radio Communication, Radio Broadcasting and Television of the Uzbek Ministry of Development of Information Technologies and Communications. The mobile communications network began commercial operations on December 1, 2014.

The abrupt sale comes just four years after MTS’s Uzbek subsidiary, Uzdunrobita, fell afoul of Uzbek authorities, which accused it of regulatory violations, arrested several of its top officials, and revoked its license, RFE/RL’s Uzbek Service reported.

Uzdunrobita was controlled at the time by Gulnara Karimova, the eldest daughter of Uzbek President Islam Karimov.

The sale is the latest fallout from a massive, multiyear investigation involving U.S. and European authorities into alleged corruption in Uzbekistan involving Karimova.

Sergey Kwan

TCA