8-K: Cohen Circle Acquisition Corp. I Announces Business Combination Agreement with Kyivstar Group, Aiming for U.S. Listing

Cohen Circle Acquisition Corp. I has entered into a business combination agreement with Kyivstar Group to create the first U.S.-listed pure-play Ukrainian investment opportunity.

Summary

• Cohen Circle Acquisition Corp. I (CCAC) announced a business combination agreement with Kyivstar Group on March 21, 2025.
• The goal is to list Kyivstar, a leading Ukrainian digital operator, on the U.S. stock market.
• The transaction values Kyivstar at 3.6x EV/2024P Underlying Adjusted EBITDA.
• Kyivstar is expected to be the only purely Ukrainian investment opportunity publicly listed in the U.S.
• Kyivstar has a resilient financial profile with $515 million Adjusted EBITDA and a 56% Adjusted EBITDA margin in 2024.
• The company has $294 million Adjusted EBITDA minus CAPEX and $429 million in cash and cash equivalents with no external debt.
• The business combination is subject to shareholder approvals, SEC approval of the registration statement, and other customary closing conditions.
• PubCo intends to file a registration statement on Form F-4 with the SEC, including a preliminary prospectus/proxy statement.
• The investor presentation highlights Kyivstar's leading market positions, ambitious expansion opportunities in digital services, and a world-class team.
• Kyivstar is committed to investing US$ 1 billion in Ukraine from 2023-2027.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive. While the deal offers a unique investment opportunity in Ukraine and Kyivstar shows strong financials, the ongoing war introduces significant risks. The attractive valuation and growth potential balance the geopolitical uncertainties.

Positives

• Kyivstar is a leading digital operator in Ukraine with strong market positions.
• The company has a resilient financial profile and a strong balance sheet.
• The business combination provides scarcity value as the only purely Ukrainian investment opportunity listed in the U.S.
• Kyivstar has a world-class team with a track record of resilience and robust governance.
• The company is committed to investing in Ukraine's digital ecosystem and improving the quality of life in the country.
• Kyivstar is a major social sponsor and top-rated employer in Ukraine.
• Kyivstar acquired 97% of Ukraines leading ride-hailing and delivery platform Uklon for $155m.

Negatives

• The business combination is subject to shareholder approvals, SEC approval, and other closing conditions.
• The ongoing war in Ukraine poses risks to Kyivstar's network infrastructure, operations, and financial performance.
• Kyivstar experienced a widespread external cyberattack in December 2023, resulting in temporary disruption of services.
• Electricity prices in Ukraine have surged, impacting Kyivstar's margins.
• Kyivstar experienced a loss of 3.1 million subscribers as of December 2024 compared to February 2022 due to subscriber migration abroad.

Risks

• The war in Ukraine poses significant risks to Kyivstar's operations, assets, and financial performance.
• Kyivstar operates in a highly competitive market and faces challenges in expanding its customer base.
• The company is subject to cyber-attacks and data breaches.
• Kyivstar is exposed to foreign currency exchange risks.
• The telecommunications industry is highly regulated, and changes in laws and regulations could harm Kyivstar's business.
• The company depends on third parties for certain services and equipment.
• Kyivstar may be unable to secure the spectrum or licenses required to remain competitive.

Future Outlook

Kyivstar aims to deepen its mobile market leadership and expand its digital services, targeting significant organic growth in digital revenues and fixed broadband market share.

Management Comments

• Oleksandr Komarov (CEO since 2018) served as CEO of GroupM and was Forbes #1 CEO in Ukraine (2020).
• Boris Dolgushin (CFO since 2019) served as CEO of Beeline (Kazakhstan subsidiary of VEON) and has 20+ years with VEON group.

Industry Context

The announcement comes as the telecommunications industry is undergoing rapid digital transformation, with companies seeking to expand their digital offerings and invest in 5G technology. The business combination aims to provide investors with exposure to the Ukrainian market, which is expected to experience economic recovery and growth in the coming years.

Comparison to Industry Standards

• The transaction is valued at 3.6x EV/2024P Underlying Adjusted EBITDA, which is a significant discount to peers.
• Global peers trade at a median of 6.7x 2024 EV/EBITDA.
• EMEA/APAC single country peers with leading market positions trade at a median of 6.2x 2024 EV/EBITDA.
• Kyivstar's 2024 EBITDA margin is 56.0% compared to the global peers average of 37.2%.

Stakeholder Impact

• Shareholders of Cohen Circle Acquisition Corp. I will have the opportunity to invest in a leading Ukrainian digital operator.
• Employees of Kyivstar will benefit from the company's continued investment in Ukraine and its digital ecosystem.
• Customers of Kyivstar will benefit from the company's expansion of digital services and improved network quality.
• The business combination will contribute to the development of Ukraine's digital economy.

Next Steps

• PubCo intends to file a registration statement on Form F-4 with the SEC.
• The Company's shareholders will vote on the Business Combination.
• The parties will seek to satisfy the closing conditions, including regulatory approvals.

Key Dates

Keywords

Kyivstar, Cohen Circle Acquisition Corp. I, Business Combination, Ukraine, Digital Operator, Investment, Merger, SPAC, Telecommunications, EBITDA