IFC lead $435m investment to modernise Ukraine’s telecom sector

The International Finance Corporation (IFC) and the European Bank for Reconstruction and Development (EBRD), with backing from the European Commission (EC) and the French government, are spearheading a $435 million investment to modernise and expand telecom services in Ukraine.

Each organisation will contribute $217.5 million in long-term debt to support the newly merged telecom group, Datagroup-Volia-Lifecell.

“The telecom sector has been essential to Ukraine’s welfare and economic resilience since the war began. This operation will result in a large and reliable telecommunications operator, important domestically, as well as a very significant international investment into the Ukrainian economy, which we are proud to be part of.” Mark Bowman, EBRD Vice President, Policy and Partnerships, said.

Led by French investor Xavier Niel’s NJJ Holding Company, in partnership with Horizon Capital, the investment aims to strengthen network resilience, deliver improved mobile connectivity to 10 million users, and enhance broadband access for 4 million households across Ukraine.

This initiative is seen as the largest foreign direct investment in Ukraine since the outbreak of its war with Russia, signalling confidence in the country’s economic potential.

IFC’s Managing Director Makhtar Diop emphasised that the project highlights Ukraine’s resilience and supports its digital infrastructure recovery from the estimated $1.9 billion in damages and $750 million in losses since the conflict began. To mitigate investment risks, part of IFC’s loan will be backed by guarantees from the EC and the French government.

“France is committed to supporting the resilience and reconstruction of Ukraine’s economy, which will require attracting large private investments in key sectors. This is why we have launched guarantee facility programmes with both the EBRD and IFC to de-risk new private investments in Ukraine. This landmark project is the first utilisation of these facilities. It will ultimately help better connect businesses and people across Ukraine. And we look forward to supporting other projects.” said Antoine Armand, French Minister of the Economy, Finance and Industry.

Since the onset of the invasion, the World Bank Group, including IFC, has mobilised over $47 billion in emergency financing for Ukraine, assisting more than 15 million people by maintaining essential services and supporting businesses through challenging times.

Attribution: IFC

Subediting: Y.Yasser