VEON Pays Back Outstanding Balance and Cancels its Revolving Credit Facility

Rhea-AI Summary

VEON repays USD 805 million debt under revolving credit facility, reducing interest expenses and improving cash management.

Financial Analyst

The repayment and cancellation of the revolving credit facility (RCF) by VEON Ltd. represent a proactive approach to capital management. By paying off the outstanding balance, the company is likely to benefit from reduced interest expenses. This action indicates a stronger liquidity position and potential improvement in financial ratios such as the debt-to-equity ratio and interest coverage ratio. Investors typically view such moves positively as they can lead to an improved credit rating and potentially lower cost of capital in the future.

However, it's important to note that the cancellation of the RCF also removes a source of flexible funding. This could limit the company's ability to quickly respond to unexpected needs or investment opportunities. Stakeholders should monitor how this decision aligns with the company's strategic growth plans and whether it has alternative funding sources available.

Market Research Analyst

VEON's decision to repay and cancel its RCF could signal confidence in its operational cash flow and financial stability. From a market perspective, such actions often reflect a company's strategic shift towards self-sufficiency and less reliance on debt financing. It's a move that might be interpreted as strength in the company's core business, which could positively influence investor sentiment and stock performance.

On the other hand, the telecommunication sector is capital-intensive with continuous needs for investment in technology and infrastructure. The cancellation of the RCF might raise questions about the company's long-term investment strategy and whether it has adequate resources to maintain competitive advantage in a rapidly evolving digital landscape.

Amsterdam, 28 March 2024 – VEON Ltd. (Nasdaq: VEON, Euronext Amsterdam: VEON), a global digital operator that provides converged connectivity and online services (the “Company”), announces that it has repaid in full the outstanding balance of USD 805 million (principal, excluding accrued interest) under its revolving credit facility (“RCF”) and cancelled the RCF.

The repayment of the outstanding amount and the cancellation of the RCF will reduce VEON’s interest expenses, in line with our effective cash and balance sheet management practices.

Important Notice
Elements of this press release contain or may contain “inside information” as defined under the Market Abuse Regulation (EU) No. 596/2014.

About VEON
VEON is a digital operator that provides converged connectivity and digital services to nearly 160 million customers.  Operating across six countries that are home to more than 7% of the world’s population, VEON is transforming lives through technology-driven services that empower individuals and drive economic growth.  Headquartered in Amsterdam, VEON is listed on Nasdaq and Euronext. For more information visit: https://www.veon.com.

Disclaimer 
This release contains “forward-looking statements,” as the phrase is defined in Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. Forward-looking statements are not historical facts, and include statements relating to, among other things, VEON’s expectations to enter into negotiations with lenders for a new RCF. Forward-looking statements are inherently subject to risks and uncertainties, many of which VEON cannot predict with accuracy and some of which VEON might not even anticipate. The forward-looking statements contained in this release speak only as of the date of this release. VEON does not undertake to publicly update, except as required by U.S. federal securities laws, any forward-looking statement to reflect events or circumstances after such dates or to reflect the occurrence of unanticipated events. 

The Company cautions that its forward-looking statements are based on its current expectations and assumptions, which are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include, but are not limited to, the risks and uncertainties described in the Company's filings with the SEC, including its most recent annual report on Form 20-F.

Contact Information:
Hande Asik
Group Director of Communication 
pr@veon.com

Faisal Ghori
Group Director of Investor Relations
ir@veon.com

 

How much debt did VEON repay under its revolving credit facility?

VEON repaid the outstanding balance of USD 805 million under its revolving credit facility.

What impact will the repayment of debt have on VEON's interest expenses?

The repayment of debt will reduce VEON's interest expenses.

What is the ticker symbol for VEON ?

The ticker symbol for VEON is VEON.