Share and Dividend Policy

Share Capital

The authorized share capital of Kcell amounts to KZT 33.8 billion, divided into 200,000,000 ordinary shares with a par value of KZT 169.00. The number of issued and outstanding common shares is 200 million. All issued and outstanding common shares were fully paid. The Company does not have any authorized or issued preference shares or any convertible securities, exchangeable securities or securities with warrants in issue.

All shares are registered in the share register of the Company, which is maintained by Integrated Securities Registrar JSC (Central Registrar). Ownership of the Company’s shares is evidenced by an extract from the shareholders’ register of the Company.

In December 2012, Kcell launched its initial public offering on the Kazakhstan Stock Exchange (KASE) with the trading code KCEL and initial Global Depositary Receipts (GDR) offering on the Main Market of the London Stock Exchange (LSE). Until the IPO, 100% of Kcell’s shares were owned by Fintur and Sonera. After the IPO, their aggregate share fell to 75%, so Fintur and Sonera continue to exercise primary control over the Company, for example in election of members to the Board of Directors, declaration of dividends, changes to the Charter and control over virtually all decisions falling within the exclusive competence of the General Shareholders’ Meeting of Kcell.

The Joint Global Coordinators and Joint Bookrunners for international offering of GDRs were Credit Suisse, UBS Investment Bank and Visor Capital. Renaissance Capital acted as Joint Bookrunner and Halyk Finance as Co-manager. Visor Capital was responsible for organizing the offering of Kcell shares in Kazakhstan.

Shareholder Ownership of shares before IPO Ownership of shares after IPO
  Quantity % Quantity %
Fintur Holdings B.V. 102,000,000 51 102,000,000 51
Sonera Holding B.V. 98,000,000 49 48,000,000 24
Depositary - - 45,123,528 22,6
Holders of shares sold in the Domestic Offer (including shares deposited with Central Securities Depositary JSC) - - 4,876,472 2,4
Total: 200,000,000 100 200,000,000 100

Dividend Policy

On October 17, 2012, the Kcell General Shareholders’ Meeting approved the dividend policy, which is part of the Corporate Governance Code and will apply to all dividends declared.

According to the dividend policy, if the Kcell shareholders do not decide otherwise, the size of the annual dividend on Kcell’s common shares will be at least 70% of net income for the previous fiscal year. Resolution of the General Shareholders’ Meeting shall be based on the proposals of the Board of Directors regarding payment and amount of dividends. In making recommendations to the General Meeting of Shareholders, the Board of Directors shall take into account the current state of the Company, available cash, cash flow estimates and investment plans in the medium term, as well as the state of the capital market. Kcell plans to pay dividends annually.

Results of the year 2009 2010 2011 2012
Total amount of declared dividends, KZT million 41,600 58,000 115,877 32,403*
Net income, KZT million 41,197 54,768 66,858 61,828
Dividends declared as a share of net income, % 96% 106% 173% n/a
Total amount of dividends paid, KZT million 41,000 58,000 115,877 0**

* All net income earned by the Company after reorganization into a JSC from July 1, 2012 till December 31, 2012, which can be allocated.

** The payment of dividends will be made not later than June 30, 2013.