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HomeEconomicsLarge Kazakhstani Bank to Sell Stake in Telecoms Company  – The Diplomat

Large Kazakhstani Bank to Sell Stake in Telecoms Company  – The Diplomat


Just a year ago, Jusan Bank, one of Kazakhstan’s largest lenders, bought a stake in Kcell, one of the largest operators in the country, during a shopping spree in mobile telecom ventures. Now, it plans to sell it off.

The largest shareholders of Kcell are Kazakhtelecom (51 percent), Pioneer Technologies (14.87 percent), Jusan Bank (9.08 percent), and Kazakhstan’s Single Pension Fund (7.07 percent).

Kazakhtelecom sold a 24 percent stake to Jusan and Pioneer in September 2021. Pioneer, which is registered in Luxembourg, is connected to Jusan because both ownership structures link back to the Nazarbayev Foundation, an institution established by former President Nursultan Nazarbayev.

The deal was later criticized by lobbyist working on behalf of minority shareholders in Kazakhstan, as the announcement of the sale led to a significant drop in price in the weeks before the transaction took place.

Kcell used to be the local brand name of Nordic telecoms giant TeliaSonera, which infamously owned several mobile providers across Central Asia that were embroiled in corruption scandals. Through Rodnik, an investment vehicle, TeliaSonera also owned KazTransCom, a large telecoms service provider. In 2018, Telia sold its shares to a group of companies said to be close to Timur Kulibayev, one of the country’s wealthiest businessmen and Nazarbayev’s son-in-law.

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In early 2021, Jysan Ventures, a company affiliated with the bank, acquired KazTransCom, in a move to invest into mobile financial services. (Note: Jusan Bank and its affiliated parties also use the spelling Jysan and Jýsan).

In May 2022, Jusan paid out around 200 million tenge ($410,000) as a result of a lawsuit by the Single Pension Fund, which had accused the bank of paying less than market price for the shares at the time of the deal with KazTranscom.

Jusan’s telecom service investments seemed to be a move to catch up with Kaspi, the fintech giant that listed in London in late 2020.

On September 12, however, Jusan Bank announced its plan to sell its 9.08 percent stake in Kcell. 

Nurdaulet Aidosov, the bank’s chairman, said that the country’s sovereign wealth fund Samruk-Kazyna was among a few interested parties to make an offer.

“We give [Samruk-Kazyna] our preference, because we appreciate their corporate governance, internal politics, development strategy and reforms,” Aidosov said at a press conference. While he declined to comment on the financial details of the transaction, he assured that “the deal will be mutually beneficial to the two parties.”

Samruk-Kazyna already owns 51 percent in Kazakhtelecom, Kcell’s majority shareholder. Between 2018 and March 2022, Nazarbayev’s nephew Kairat Satybaldy owned a 24 percent stake in Kazakhtelecom through a Luxembourg-registered company.

In explaining Satybaldy’s detention in March, the anti-corruption agency stated that his arrest was linked to alleged embezzlement at the expense of Kazakhtelecom. In April, Satybaldy renounced his Kazakhtelecom assets, which returned to the hands of the state.

Speaking at Jusan’s press conference in September, Aidosov also transparently admitted that Kcell is the bank’s largest borrower, after it took out a three-year, 60.5 billion tenge ($130 million) loan in late 2021. The credit line amounted to around 29 percent of Kcell’s assets.

Days earlier, a Bloomberg report quoted sources close to the deal saying that the sale transaction would “reverse the controversial privatization of Kcell that was marred by suspected share price manipulation.”

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Though young on paper, the history of Jusan goes back several decades. 

Backed by the Nazarbayev Foundation, in February 2019 a financial company known as First Heartland Securities bought Tsesnabank, then the third-largest lender in the country. The bank’s name was later changed into Jusan.

In 2018 and early 2019 Tsesnabank had received a government bailout worth in total $3.4 billion. In March 2019, Nazarbayev unexpectedly resigned after three decades in power.

In 2020, Jusan announced its intention to buy mid-sized ATF Bank, a deal that it closed before the end of the year. 

After growing in size while being helped by the government in the clean-up of its toxic assets, Jusan seemed poised to venture into a range of innovative services in Kazakhstan’s financial sector. The divestment from Kcell seems to be a step back, although the bank’s indicators say it continues to penetrate the market.

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