31683 - Russian Towers

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Summary of Proposed Investment

Project Number

31683

Company Name

RUSSKIE BASHNI, ZAO

Date SPI Disclosed

Mar 7, 2012

Country

Russian Federation

Industry

Telecommunications and Technology

Projected Board Date

Apr 9, 2012

Status

Completed

Sector

Other (Including Satellite Telecommunications, Radio and Television Broadcasting, etc.)

Department

Regional Industry INF LAC & EUR

Environmental Category

B - Limited

Previous Events

Approved : Jun 12, 2012
Signed : Jun 15, 2012
Invested : Oct 4, 2013

Project Description

The project is to support the development of Russian Towers (“the Company”), an emerging independent tower operator in Russia, which is building a nationwide network of telecommunication towers to lease the tower space to Russian mobile phone operators.

The privately-owned Company was established in 2009 and is in an earlier stage of development, currently operating about 140 towers. As an independent tower operator, the Company would allow multiple mobile operators to share tower space, creating significant economic and other benefits.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	20.0

Development Impact

The project is expected to have a number of development impacts including the following: (i) improve access to mobile network in rural areas due to a decreased time to market and improved economics of accessing more sparsely populated areas; (ii) enhance the coverage and quality of service in rural areas; (iii) facilitate more economically efficient use of resources, including land and capital investments, due to the reduced need in the number of towers; (iv) reduce the visual burden of multiple towers as well as the carbon footprint (through reduced and/or more efficient use of diesel generators to supply power in rural locations); (v) encourage more competition that, together with lower capital costs and operating expenses of operators, would translate into the lower cost of services to users, and (vi) assist in the creation of direct and indirect (through subcontracting) employment opportunities.

Through its engagement IFC would support a Company at critical stage of its development, which is pursuing an innovative approach benefiting the entire telecommunication sector in Russia. As a shareholder, IFC would be able to share with the Company its knowledge and global experience in the tower sector. IFC''s presence in the project is expected to facilitate Company''s access to long-term debt financing that would be critical for the successful implementation of Company''s plans, especially in the current climate of instability in global financial market.

Contacts

For Inquiries About the Project, Contact

Dmitry Nelyubov,
General Director
Tel: +7 (495) 967-32-32
Fax: +7 (495) 967-32-31
mailto:nelubov@rtowers.ru
http://www.rtowers.ru

Victor Leonchikov
Tel: +7 (495) 967-32-32
Fax: +7 (495) 967-32-31
mailto:vleonchikov@rtowers.ru
http://www.rtowers.ru

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Local Access of Project Documentation

Russian Towers,
Etmia II Business Center
33 Shchepkina,
Moscow, 129090
Russian Federation

This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors' consideration of the proposed transaction. It is not an offer of shares to the public and is intended solely to enhance the transparency of IFC’s activities. This document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. The following SPI is disclosed in accordance with IFC’s Policy on Disclosure of Information that went into effect April 30, 2006.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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