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. Last Updated: 07/27/2016

MTS Buys Kyrgyz Mobile Operator

Mobile phone firm Mobile TeleSystems said Monday that it had taken over Kyrgyzstan's biggest mobile operator, Bitel, in a deal worth $150 million.

MTS, which is controlled by services group Sistema, bought 51 percent of Bitel from Kazakhstan's Alliance Capital, plus an option to acquire the remainder by the end of 2006.

The acquisition extends the reach of MTS into other countries of the former Soviet Union, where a smaller share of the population has a mobile phone compared with Russia's large but rapidly maturing market.

"We have entered a very promising market at just the right time," MTS CEO Vassily Sidorov said.

But the deal comes amid an ownership dispute between Alliance Capital, which is linked to Kyrgyzstan's former ruling family, and Alfa Group, owned by billionaire Mikhail Fridman.

In the most recent ruling, an economic court in the Kyrgyz capital, Bishkek, found that Alliance was the only owner of Bitel -- overturning an earlier decision in favor of Alfa.

MTS warned that international litigation was continuing and, in the worst case, that it would lose control of Bitel.

But Sidorov played down the risks: "We would not do a deal if we were not certain we could eliminate these risks."