Kyivstar Announces Purchase of 97% of Uklon, Plans to Close Deal in April

The largest mobile operator Kyivstar announced the signing of an agreement to purchase 97% of the online taxi service Uklon, which intends to expand its horizons to new markets with the support of its parent company VEON.

As it became known on Wednesday from the press service of Kyivstar, the completion of the deal is scheduled for April 2025, and its amount is $155.2 million. After signing the agreement, Kyivstar and Uklon will remain independent companies. The Uklon team will continue its work under the leadership of the current CEO Sergey Grishkov.

For Kyivstar, investing in Uklon represents a logical step in creating an integrated digital ecosystem and an important milestone in inorganic growth and business scaling, which is in line with VEON's $1 billion investment commitment for the period 2023–2027, the company noted.

“Our strategy is not only to provide communications, but also to create a comprehensive digital environment where electronic communications serve as the basis for the implementation of innovative services. Uklon is one of the leading players in its market, a recognized “lovemark” for Ukrainians and a technological innovator in the field of online car booking. This is an impressive company with the right corporate culture and values. We have a lot in common, and by joining forces, we will be able to strengthen each other and create even more innovative services, jointly investing in the Ukrainian economy,” emphasized Oleksandr Komarov, CEO of Kyivstar.

The investment is fully consistent with the strategy of VEON and Kyivstar to form a digital operator, added Zoya Dronshkevich, Director of Business Development and Corporate Strategy at Kyivstar.

“Following the completion of the transaction, we will invest in expanding Uklon’s ecosystem of services and products, including multifunctional applications for passengers and drivers, developing synergies between our businesses in Ukraine, as well as further expanding Uklon into other countries where VEON operates and into new markets with the potential to create value for customers and shareholders,” she said.

For Uklon, this deal opens up new development opportunities: from increasing strategic investments in digital services to creating additional jobs and entering new markets with the support of global digital operator VEON, the parent company of Kyivstar, the statement said.

“We have always had ambitions to develop both in Ukraine and in new markets. I am confident that with the support of Kyivstar, Uklon will gain additional opportunities and expertise to further improve our services and products in order to provide even greater value to all our users and partners,” said Uklon co-founder Dmitry Dubrovsky.

Kyivstar emphasized that this deal is an important signal for Ukrainian and international investors who are ready to participate in the restoration of Ukraine, despite the ongoing war.

Dragon Capital acted as the exclusive financial advisor to Uklon in this transaction.

Oleksandr Parashchy, head of the analytical department at investment company Concorde Capital, commented on the value of the deal upon request, noting that it is approximately 20 times higher than the EBITDA indicator calculated on the basis of Uklon's Ukrainian financial statements.

“This is a relatively low multiple for this sector, but it is quite generous for Ukraine. The key unknown for an accurate assessment remains the growth forecasts embedded in the company's business model,” the analyst added.

Another market participant, who wished to remain anonymous, pointed to several factors influencing the deal and its valuation. These include Kyivstar’s possible desire to complete the acquisition before the secondary public offering (SPO) on Nasdaq, as well as the company’s significant available funds due to currency restrictions imposed by the National Bank of Ukraine.

Earlier, the Antimonopoly Committee of Ukraine (AMCU) issued Kyivstar permission to acquire the online taxi service Uklon, including its divisions: Tech Uklon LLC, Uklon Corporate and Uklon Ukraine. In addition, Kyivstar submitted a repeated application to the AMCU to acquire MTPK LLC, which owns the online drug price aggregator Tabletki.ua.

Kyivstar, Ukraine's largest mobile operator, serves about 24 million subscribers. The company's digital services portfolio includes the Helsi digital medical platform, which has 28 million registered users, as well as the Kyivstar TV film and television platform. In August 2022, Kyivstar acquired 69.99% of Helsi shares for UAH 555.74 million.

Kyivstar revenue in January-September 2024