$US 4.2 billion merger in Russian communication sector

Russia's second biggest mobile phone company is in talks to buy fixed-line giant Golden Telecom. VimpelCom is believed to ready to spend $US 4.2 billion on the Russian firm.

If the deal goes ahead, the company would be Russia's first integrated mobile and fixed-line provider.

On Monday the two firms said they were in talks.

Vimpelcom has offered $US 105 a share for Nasdaq-traded Golden Telecom,  an internet, voice and data service provider.  The figure is three and a half times the firm's closing price on November 30.

Co-head of research at Uralsib Financial Corporation, Konstantin Chernyshev, says the deal could bring Vympelcom “to a new level of development”. 

“Such a deal will help Vympelcom to transform a mobile provider into a fully-integrated telecom provider, offering a wide range of telecom services, ranging from mobile to fixed local and long-distance communications,” Chernyshev said.