Kcell acquires 5G equipment from Sweden

Kcell, a mobile operator in Kazakhstan that runs the well-known brands Kcell and Active, has reached a deal with Ericsson. Under the deal, the Swedish telecommunication hardware producer will supply Kcell with 5G equipment, as the operator has won a bid related to the development of the new mobile communication standard in Kazakhstan, according to the Kazakhstan Stock Exchange (KASE).

In fact, the two sides signed three agreements. Although they haven’t revealed any details of the deal, a Kcell representative said that the operator’s financial liabilities under the arrangement are equal to 26% of its owned capital. As of December 2022, the company’s equity was about $310.6 million.

KASE also reported that two of the agreements are deemed to last until the end of 2023, while the other will last until December 2026.

In February 2023, Kcell reported an $89.6 million loan from Kazakhtelecom, its key shareholder, with the purpose of deploying a 5G network within the country. At the time, the company said that the transaction required more than 10% and less than 25% of its assets.

In December 2022, Kcell and Mobile Telecom Service (which controls the Tele2 and Altel brands) won the bid for the development of 5G frequencies (3,600 – 3,700 Megahertz and 3,700 – 3,800 Megahertz, respectively). Both companies are obliged to pay $349.6 million for the frequencies and install at least 7,000 base stations within the country.