Golden Telecom

Founded in 1996 by the global corporation Global Telesystems ("GTS"). NYSE-listed Global TeleSystems ("GTS") was the owner of EBONE one of Europe's leading broadband optical and IP network service providers (a Tier 1 network). GTS had its IPO on the NASDAQ in 1998. In 2000, a new management including Robert A. Schriesheim as CFO, was brought in to help restructure and refocus the company.[3] GTS was a pan-European communications services provider, backed by Alan B. Slifka and affiliates of George Soros and Soros Private Equity, with revenues of over $1 billion and operations in 20 countries in Europe. In October 1999 GTS did an IPO of on the NASDAQ of, Golden Telecom, which held communications assets in Russia, with GTS retaining a 65% interest.[4] GTS was essentially a portfolio of communications assets in Western and Eastern Europe which went through an IPO in 1998 and subsequently experienced challenges with an over-levered balance sheet as Europe went through deregulation and from the overall fall-out of the dot.com boom and bust which impacted its customer base. In 2001, to facilitate the sale of GTS, Mr. Schriesheim helped lead it through a pre-arranged filing under Chapter 11 of the United States Bankruptcy Code (U.S.B.C.) and, in prearranged proceedings, a petition for surseance (moratorium), offering a composition, in the Netherlands to restructure its debt, in excess of $2 billion. All such proceedings were approved, confirmed and completed by March 31, 2002, as part of the sale of the company.[5] David A. Stewart served as Senior Vice President, chief financial officer and Treasurer at that time and left Golden Telecom in 2004.[6]

Golden Telecom was acquired by VimpelCom in 2007.[7]

Golden Telecom LLC is the smallest GSM operator in Ukraine, although it started early by launching its GSM-1800 operation back in 1996. Its wireless network covers just two metropolitan areas: Kyiv and Odesa, lacking the national coverage of its competitors. In the early 2000s new owners (controlled by the Russian Alfa Group) shifted company's strategy, which since then has focused on providing integrated telecommunications services for businesses and other high-usage customers and telecommunications operators.

The current number of Golden Telecom's GSM postpaid and prepaid subscribers is just below 50,000 (June 2007). The outlook of its GSM business is quite grim in the wake of huge success and growth of traditional (Kyivstar, UMC) and emerging (Astelit) competitors. Even its earlier competitive advantage, absence of the connection fee (a small flat fee, usually $0.05–$0.06, charged by Kyivstar and UMC per connection in addition to per minute rate), is not a factor anymore as new competitors (Astelit, Beeline) do not charge connection fees as well.

To cope with its limited GSM coverage, the company has recently concluded an agreement with Beeline, another trailing local mobile operator, which allows Golden Telecom's contract subscribers to roam onto Beeline's growing cellular network throughout Ukraine. This is the first national roaming agreement between mobile operators in Ukraine.

Golden Telecom's network code in Ukraine is +38039*******.

Golden Telecom LLC Ukraine is a division of Golden Telecom Inc. (NASDAQ: GLDN), which also operates a telecom business in Russia.

• Stewart P. Reich