Datagroup, announced today it has reached an agreement to acquire 100% of Volia group of companies in Ukraine, with the full backing of Horizon Capital’s EEGF II fund. EEGF II is the sole financial investor in Datagroup with a 96.13% stake, alongside CEO Mykhailo Shelemba, who holds 3.87%. This transaction is subject to customary regulatory approvals.

Lenna Koszarny, Horizon Capital’s Founding Partner and Chief Executive Officer, commented on the deal: “The vision of uniting these two companies, both private-equity backed, has been a long-held dream within Horizon Capital and Datagroup. We are thrilled to realize the opportunities from merging two companies which are such a natural fit for each other. Both Datagroup and Volia operate in a highly fragmented industry which historically has meant limited investor interest and capital invested. Scale truly does matter when it comes to infrastructure to meet the demands of increasing digitalization, requiring significant capital investments to modernize and expand both last-mile and national fiber infrastructure. The winners from this merger will be Ukraine’s consumers and the country as a whole, as Ukraine needs significant backbone infrastructure investments to meet the demands of the digital age”. She concluded with, “I wish to extend a sincere thank you and appreciation to Volia’s talented management team and dedicated shareholders, who truly have built a successful business committed to delivering quality service, continuous innovation and exceeding customer expectations, and to the stellar Datagroup team!”

Mykhailo Shelemba, Datagroup Chief Executive Officer and shareholder, added further: “I look forward to this new, exciting chapter in the Company’s development. The fixed broadband market in Ukraine is extremely fragmented with over 5,000 internet service providers operating in the country. This large fragmentation does not allow most players to maintain high investment levels necessary to continuously introduce new technologies for their customers, which is critical in this modern, digital world. The merger of Datagroup and Volia will allow us to realize operational synergies, invest into modernization of our networks, continue to provide best-in-class service for our customers, and create greater opportunities for our employees. Each company focuses on different customer segments – Datagroup is the leader in B2B segment with only 15% of its revenues generated by B2C, while Volia is the leader in the B2C segment with less than 5% of its revenues generated by B2B customers. Post-integration, the combined business is expected to generate revenues exceeding $130 million and over $50 million in  EBITDA, with one of the lowest leverage ratios among large telecom companies in the CEE region. We hope that our example will pave the way for greater investor interest and significant investments in Ukraine’s infrastructure throughout the country, by both domestic and global players. We believe in Ukraine and its future!”

Anton Dzyubenko, CEO of Volia added: “On behalf of Volia, our management team and employees, we look forward to embarking on this journey together with Datagroup and Horizon Capital. We are proud of our team and our significant achievements over the years and look forward to new successes in the future on the basis of our consolidated platform. The merger will allow us to bring new technologies, to further extend our world-class standards of corporate governance, and to make a significant contribution to Ukraine’s pursuit for greater digitalization and breaching the digital divide. This is a win-win-win for all – for Volia, Datagroup and Ukraine as high growth and greater performance generates more taxes and benefits to society, thus supporting the country’s government in achieving global leadership in the provision of high-quality digital services for its citizens”.

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Datagroup is a leading national fiber operator with dominant market share in corporate and wholesale segments. Leveraging its fiber-optic network (including backbone & FTTx), the Company is a reliable partner for over 50% of the top 200 largest companies in Ukraine and 93% of the country’s banks. Datagroup benefits from a strong foothold in residential and SME segments, and is the only provider of satellite connectivity in Ukraine, which is in demand in areas with no fiber and mobile coverage. Datagroup provides a wide range of services for business, including the construction of corporate networks, Internet services and television, access to banking services, cybersecurity and protection against DDoS attacks, telephony and outsourcing contact center services, cloud services and data center services. For individuals, Datagroup provides Internet, television, and telephony services. Since 2016, the Company has been led by CEO Mykhailo Shelemba, who has raised Datagroup to a new level, delivering impressive operational and financial performance based on high-impact projects in network management, security and efficiency of IT systems, staff motivation and productivity, and launch of new products and services, including cybersecurity and cloud services. Today, Datagroup is one of the fastest-growing telecom companies nationwide, more at https://www.datagroup.ua/

Volia is a leading national Ukrainian telecommunication provider that provides modern telecommunications services: analog, digital, HD- and interactive television, high-speed Internet access and services of one of the largest data centers in Ukraine. The Company offers more than 200 TV channels from Ukrainian and the best international TV companies, online cinemas and content libraries from the world’s best studios, observing all international standards in the field of copyright and related rights. Volia has been led by CEO Anton Dzyubenko since July 2019, when he returned from Riga to lead the Company in which he had held senior positions in over the years. More at https://www.volia.com/

 Horizon Capital is the leading private equity firm in Ukraine and Moldova backed by over 40 institutional investors with a capital base of over $350 billion, managing four funds with assets under management of over $850 million and a tenure of 25 years in the region. The firm is an active, value-added, growth equity investor, investing alongside visionary entrepreneurs leading transformational businesses in Ukraine and the near region. Our investment strategy focuses on export champions in technology, e-commerce, light manufacturing, and food and agro, as well as select domestic champions in fast-growing sectors. We are known for our strong team, high integrity and governance, value creation and track record of successful investments. More at www.horizoncapital.com.ua