Deutsche Bank Reports Pricey But Expected VimpelCom ADR

According to Deutsche Bank, VimpelCom ADR (NYSE: VIP) is pricey but expected.

Deutsche Bank said that KT Corp announced that it agreed to sell its 80% stake in its Russian unit NTC to VimpelCom for USD346m. “Overall, the deal was expected. Various press reports placed VimpelCom as the favourite among other possible suitors, and the valuation numbers mentioned in the press were in the range of USD350-500m. Therefore, we think the acquisition should be neutral for the stock price overall, although a premium valuation (which we estimate at about 9x 2010 EV/EBITDA) is unlikely to impress the market, unless management can justify the premium.”

VimpelCom closed yesterday at $14.00.