Government allocates radio frequency for LTE (4G) services


Almaty, 06 January 2016 - Kcell Joint Stock Company ("Kcell” or the “Company”) (LSE, KASE: KCEL), the leading provider of mobile telecommunications services in Kazakhstan by market share in terms of revenue and subscribers, announces that it has been informed by Kazakhstan’s Ministry for Investments and Development (“the Ministry”) that the Ministry will allocate radio frequencies that will enable the rollout of LTE services to all existing mobile operators in the Kazakh market.

The Ministry will allocate to Kcell access to 10+10 MHz radio frequency within the 700/800 MHz band on payment of a one-off fee of KZT 22 billion, to be made in two tranches of KZT 10 billion by 1 March 2016 and KZT 12 billion by 1 December 2016.

The Ministry will also allocate to Kcell access to 10+10 MHz radio frequency within the 1700/1800 MHz band, on payment of a one-off fee of KZT 4 billion by 1 February 2016.

In addition, the Ministry will permit all existing mobile operators to use the radio frequencies allocated to them in the GSM, DCS-1800 (GSM-1800) UMTS/WCDMA (3G) standards for the provision of LTE (4G) and LTE Advanced services subject to obtaining the respective radiofrequency permits in the prescribed manner.

The Ministry will issue these radio frequency permits to mobile operators in the Kazakh market on condition that they guarantee mobile coverage in communities with 500-plus inhabitants and along the highways and railways of national and regional importance by 31 December 2020.

Arti Ots, CEO of Kcell, said:

“We welcome the decision by the Ministry to grant access to these radio frequencies. This spectrum allocation, particularly within the 800 MHz frequency band, will enable us in due course to provide Kcell subscribers with first class LTE services as we continue to implement our customer centric strategy and maintain our high standards of technology excellence."




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Company Overview

Kcell provides mobile voice telecommunications services, messaging services, value-added services such as multimedia 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, which represent 25 percent of Kcell’s share capital. TeliaSonera holds directly and indirectly 61.9 percent 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 and to introduce high quality 4G services in due course. 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.