Vimpelcom seeks loan amid GT bid talk: sources

MOSCOW (Reuters) - Vimpelcom (VIP.N), Russia's No.2 mobile phone firm, aims to close syndication of a major loan in early December and may refinance the debt in 2008 via a Eurobond issue, a banking source said on Tuesday.

Vimpelcom, in which private equity group Alfa and Norway's Telenor TEL.ON own strategic stakes, is the target of intensifying media speculation that it is raising the cash to acquire fixed-line operator Golden Telecom GLDN.O.

"Vimpelcom wants to get the money up front. They plan to cover the six-month bridge financing with an issue of Eurobonds," the source told Reuters, adding the deal structure should be finalized this week.

Bankers said Vimpelcom was seeking to borrow $4.5 billion, but Interfax cited its own sources as saying the loan may be cut to $3.5 billion and pay LIBOR +125 basis points.

People familiar with the matter said Vimpelcom was eyeing the deal as a so-called convergence play to bundle its services with those of Golden Telecom, which has launched urban Wi-Fi networks in Russia.

A second source suggested the deal may involve a share swap: "Vimpelcom will buy Golden Telecom, and the shareholders of Golden will get a stake in Vimpelcom," the source said.

Such a transaction could create value in Russia's saturated mobile phone market, where penetration has reached 114 percent and subscriber growth is expected to fade, analysts said.

"Strategically this is a good idea for Vimpelcom," said Igor Semenov, a telecoms analyst at ING Bank in Moscow.

"If this happens, it won't be surprising, as (Vimpelcom CEO Alexander) Izosimov's comments some time ago clearly suggested it was time to think about new drivers of growth."

Russian mobile market leader MTS (MBT.N), plans to bundle services with affiliate Comstar (CMSTq.L). Their majority owner, Vladimir Yevtushenkov, has said the two could merge one day.

TIGHT-LIPPED

For a deal to happen, Vimpelcom's core shareholders Alfa and Telenor, who are embroiled in a long-running legal dispute over their Ukrainian venture Kyivstar, would have to come on board.

"The news about this big loan is symptomatic -- it means friction between the two sides has fallen significantly," said Konstantin Chernyshov, telecoms analyst at UralSib.

Chernyshov speculated Alfa may cash out of some telecoms investments before Russian voters elect a successor to President Vladimir Putin next March. "Elections, the political situation -- who knows what turn life might take?" he said.

Alfa's telecoms arm Altimo, which has a 44 percent voting stake in Vimpelcom, owns 26.6 percent of Golden Telecom (GT). Telenor owns 29.9 percent of Vimpelcom and 18.3 percent of GT.

Altimo was not available for comment, and Vimpelcom and GT both declined comment.

Telenor's chief spokesman, Dag Melgaard, said: "It would be improper for me to comment on this until there are concrete proposals put to the board of Vimpelcom." Vimpelcom had not yet said what it planned to use the loan for, he added.

Two other minority shareholders at GT -- Rostelekom (RTKM.MM) with an 11 percent stake and Inure with 8.9 percent -- said they had not received any approach from Vimpelcom.

Despite the industry logic for a deal, ING's Semenov was perplexed at the timing, given that GT's share price has more than doubled in the year to date.

Vimpelcom's ADRs opened 3.8 percent down in New York at $33.62, valuing it at $32 billion, amid concerns it may overpay. GT's stock fell 3.4 percent to $100, valuing it at $4.2 billion.

(Additional reporting by Anastasia Onegina, Douglas Busvine and Maria Kiselyova in Moscow, and Wojciech Moskwa in Oslo)