Ukrainian Radio Systems (merged with Vimpelcom)

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Ukrainian Radio Systems (URS) was a closed joint stock company founded in 1993 by the State Company for Radio Communications and Radio and TV Broadcasting (65%), and the Foundation for Business Cooperation "Ukraina" of the Presidential Administration (35%). URS teamed up with Motorola in a GSM900 project after receiving the necessary operational GSM license. Motorola invested approximately US$2 million into frequency research, based on Ministry of Communications (MOC) guarantees that there would be only two GSM operators. On September 15, 1996, Motorola announced a planned Investment of US$500 million for a GSM900 network in Ukraine. To run the future network, Motorola and URS created a joint venture. In a turn of events, Motorola exited the GSM900 network project after new tariffs were announced. The three GSM frequency licenses were issued (one for Motorola/URS), and the available spectrum was publicized. The decision to leave the GSM project was made by Motorola based on the belief that the project would be financially unprofitable given the existing GSM tariffs, the number of operators and the available spectrum. After Motorola withdrew, URS began discussions with Daewoo Corporation, and bid for a national GSM900 frequency license through one of its joint ventures, Ukrdaewootelecom. However, the new bid failed, as the company continued to be relegated to Kyiv and the surrounding region. URS filed a lawsuit with the Kyiv arbitration court disputing the State Radio Frequency and Communications Oversight Center's refusal to issue the mobile frequency permit to the company. The company said that in 1999 it paid for work to convert GSM-900 frequencies in Ukraine's regions, investing about US$30 million in paying for and developing licenses. Furthermore, it argued that contracts had been signed with foreign investors on more than US$100 million of investment over the calendar year to build a mobile communications network in regions of Ukraine. URS, which provided mobile services in Kyiv under the Wellcom brand, had about 40,000 subscribers by end 2004, 8% more than at the end of 2002. WellCom's expansion ability was severely hampered by the long-running dispute between its Ukrainian shareholders and its erstwhile foreign investor, Daewoo, who held 49% shares in the operator. That dispute was finally put to an end in January 2003 when the Korean firm divested. The operator was subseqently owned by Ukrfondinvest (31%), Interinvest (20%), Optima Telecom (24.5%) and Occidental Management Co. Ltd (Cyprus), (24.5%). In 2005 Russian company VimpelCom acquired URS for $231 million. The purchase was opposed by Telenor, one of Vimpelcom's major shareholders. URS started operating under the Beeline brand from 2006. In January 2006, Telenor launched three court actions in Moscow Arbitration Court against VimpelCom over the manner in which Vimpelcom acquired URS. In November 2006, the court rejected Telenor’s court actions. In January 2006, VimpelCom was set to invest between USD50 million and USD60 million in Ukraine in the first quarter of 2006 to pave the way for the re-launch of GSM operator Ukrainian Radio Systems (URS). Vimpelcom relaunched URS under its BeeLine brand name on 11 April 2006, and reported that it signed up 100,000 users within the first month. URS aimed to increase its subscriber base to between five million and six million by mid-2008 through an estimated USD500 million investment, based on subscriber acquisition costs of USD100 per new user. As of August 2006, URS had increased the number of its GSM base stations by 60% since the beginning of the year to over 1,000, its press office reported yesterday. As of end of June 2006, URS had 573,000 subscribers, up from 278,000 at the end of March. As an effort to increase the company’s population coverage, in July 2006, URS signed a unilateral national roaming deal with the country's smallest cellco Golden Telecom. URS aimed to increase its subscriber base to between five million and six million by mid-2008 through an estimated USD500 million investment, based on subscriber acquisition costs of USD100 per new user. In November 2006, Ukraine's National Commission on Communications Regulation (NCCR) refused to issue licenses for 3G services to URS. The reason given for the refusal was that URS failed to reach an agreement with military bodies on joint usage of UMTS frequencies. In April 2010, a new entity,VimpelCom Limited, completed a tender offer to exchange ownership of OJSC VimpelCom and Ukraine’s Kyivstar for shares in VimpelCom Limited, listed on the New York Stock Exchange under the ticker symbol “VIP” previously held by OJSC VimpelCom. As a result Kyivstar-Beeline became 100% owned by Vimpelcom. As of April 2010, the company does not exist. It has merged operations with Kyivstar (ID 944) In 2006, Vimpelcom was set to invest between USD50 million and USD60 million in Ukraine in the first quarter to pave the way for the re-launch of Ukrainian Radio Systems.