Kazakhstan’s anti-monopoly agency wants Kcell to follow Tele2’s suit and go private

Kcell, a large mobile operator in Kazakhstan, which operates under the Kcell and Activ brands, has been included in the list of companies proposed for transfer into a competitive environment, according to a report by Kazakhstan’s Agency for Protection and Development of Competition (APDC) available on its official website.

The agency explained its decision to include Kcell in the privatization list, citing Kazakh national telecom operator Kazakhtelecom (which holds a 51% stake in Kcell) as having «power in the market» and dominating both the telecommunications sector and adjacent markets.

Moreover, the APDC believes that public ownership (since the government controls Kazakhtelecom, it also has a share in Kcell) in the operator hinders the development of alternative players and prevents them from entering the market.

«By reducing the state’s share in the reviewed market, players from adjacent markets could enter it, along with already active players expanding their production capacities or volumes,» the agency said in a statement.

Therefore, the APDC questions whether Kazakhtelecom’s activities comply with the principle of limited public involvement in entrepreneurship. The agency highlighted that the government should fulfill tasks only in those areas where participation of private companies is not possible.

The APDC also highlighted that a partial or complete withdrawal of Kazakhtelecom from operational activities would allow the government to focus on strategic infrastructure management and market regulation.

Previously, in response to the Qazaq Association of Minority Shareholders (QAMS), Kazakhtelecom stated that Kcell would remain within its structure and that the mobile operator’s securities would continue to be traded on the Kazakhstan Stock Exchange (KASE).

In Feb. 2024, it was announced that Kazakhtelecom would sell another mobile operator under its ownership, Mobile TelecomService (MTS), which operates under the Tele2 and Altel brands. The deal had been in the process of being finalized for almost a year and was finally closed on Jan. 14, 2025, when Qatari Power International Holding acquired the company.

Notably, in early 2024, when there was no information about the privatization of MTS, experts referred to Kcell as the most probable asset for sale.

On Sep. 5, 2024, Kazakhstan’s Minister of Digital Development, Innovation and Aerospace Industry Zhaslan Madiyev stated that the agency had no plans for Kcell’s privatization and that a deal like this would not enhance market competition.

As of Jan. 1, 2025, apart from Kazakhtelecom, stakes in Kcell were also held by KC Holding Ltd. Private Company (14.87%), First Heartland Jusan Bank (9.08%) and the Unified Accumulative Pension Fund (7.1%), according to KASE.