Information on administrative sanctions imposed on Kcell JSC
Almaty, 14 August, 2014 - Kcell Joint Stock Company (LSE, KASE: KCEL), brings this information to the attention of its shareholders and investors pursuant to paragraph 1.9 of Article 79 of the Law On Joint Stock Companies of the Republic of Kazakhstan: by order of Almaty City Specialized Interdistrict Administrative Court #3-17726/14 of 03 July 2014 in the Always Available case, Kcell JSC was brought to administrative responsibility under Article 147, part 3 of the Code of Administrative Offences of the Republic of Kazakhstan resulting in a fine of 41 781 928 (forty one million seven hundred eighty one thousand nine hundred twenty eight) tenge.
The order came into force on 07 August 2014.
Kcell is the leading provider of mobile telecommunications services in Kazakhstan by market share in terms of revenue and the number of subscribers. It has operated since 1998, and as at December 31, 2013 it had approximately 14.3 million subscribers, representing a market share of 46.2%, as estimated by the Company. Its estimated market share in terms of revenue was 54% for the year ended December 31, 2013.
Kcell provides mobile voice telecommunications services, value-added services such as short message services, multimedia messaging services and mobile content services, as well as data transmission services including internet access. It has two brands: the Kcell brand, which is targeted primarily at corporate subscribers (including government subscribers), and the Activ brand, which is targeted primarily at mass market subscribers. The Company offers its services through its extensive, high quality network which covers substantially all of the populated territory of Kazakhstan.
In December 2012, Kcell successfully completed its offering of GDR’s on the London Stock Exchange and common shares on KASE. The price was set at USD 10.50 per GDR and KZT 1,578.68 per share with each GDR representing one share. The offering consisted of a sale by TeliaSonera of 50 million shares; it represents 25 percent of Kcell’s share capital. TeliaSonera holds directly and indirectly 61.9% of the Company’s common shares.
Kcell plans to benefit from the significant growth potential for mobile data services in Kazakhstan. The Company intends to continue to invest in the deployment of its 3G network to expand coverage. Kcell aims to maintain its market leadership in terms of revenue and the number of subscribers by offering its products and services at competitive prices, expanding its offering of products and services, maintaining the high quality of its network and enhancing its brand value.