IFC, EBRD, EU, and France Help Deliver Largest FDI in Ukraine Since Invasion

IFC, a member of the World Bank Group, and the European Bank for Reconstruction and Development (EBRD), with support from the European Commission (EC) and the Government of France in form of guarantees, are enabling an investment program to modernize, expand, and improve telecom service quality in Ukraine.

IFC and the EBRD are jointly providing a total of $435 million in long-term debt ($217.5 million each organization) to support a landmark project involving two leading Ukrainian telecom companies, lifecell LLC and Datagroup-Volia, who recently merged to form a new group, Datagroup-Volia-lifecell. The investment will support the merged group in enhancing phone network resilience and improving digital connectivity across Ukraine.

NJJ, a French telecom investment holding company owned by investor Xavier Niel, leads the new group with a majority stake. NJJ is partnering with Horizon Capital, a leading a leading private equity firm in Emerging Europe, and Mykhaylo Shelemba, former CEO of Datagroup-Volia, is now CEO of the new group.

Makhtar Diop, IFC’s Managing Director, said: “By strengthening digital connectivity and network resilience, we are delivering a vital service to millions of Ukrainians while reaffirming our commitment to the country. This project is the largest foreign direct investment by a major strategic investor since Russia’s invasion. It sends a strong message to global investors about the resilience and significant potential of Ukraine's economy."

Through this high-impact transaction, the merged group will deliver improved mobile connectivity to 10 million subscribers and provide faster and more reliable fixed broadband access to 4 million homes.

Leveraging its scale, the operational expertise of its new shareholders, and support from IFC and the EBRD, the group will also enhance protection against cybersecurity threats, introduce more competitive products and services, and implement best practice standards at a critical time. Additionally, the project will support the telecom sector's recovery from the estimated $1.9 billion in direct damages and $750 million in losses incurred since Russia’s invasion.

To mitigate investment risks, a portion of IFC’s loan will be covered by guarantees provided by the EC under the Ukraine Investment Framework and the government of France in support of IFC’s Economic Resilience Action (ERA) Program for Ukraine.

Since February 2022, IFC invested $1.6 billion, including over $1.1 billion from its own account and $530 million mobilized. This more than doubles the average annual financing levels before the invasion. The support is part of the World Bank Group's (WBG) response package, which has assisted more than 15 million Ukrainians by helping businesses stay afloat and enabling the government to provide essential services, pay wages, keep schools and hospitals open, and make critical repairs.

The WBG has mobilized more than $47 billion in emergency financing to date, including commitments and pledges from development partners.

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