F-1/A: Kyivstar Group Files F-1/A for Nasdaq Listing, Details Ukraine War Impact

Kyivstar Group Ltd. filed an amended registration statement for the resale and issuance of common shares and warrants on Nasdaq, detailing its business, recent acquisitions, and the significant impact of the ongoing war in Ukraine on its operations and financial outlook.

Summary

• Kyivstar Group Ltd. (the Company) is filing a registration statement for the offer and sale of up to 213,710,538 common shares by selling securityholders and the issuance of 7,666,629 common shares upon warrant exercise.
• The Company consummated a business combination on August 14, 2025, where VEON Holdings B.V. became a direct, wholly-owned subsidiary of Kyivstar Group Ltd., and Cohen Circle Acquisition Corp. I merged into a subsidiary of Kyivstar Group Ltd.
• Kyivstar is Ukraine's leading mobile communication provider by subscribers (over 23 million) and broadband services by access lines (over 1.1 million) as of December 31, 2024.
• For the year ended December 31, 2024, profit was $283 million and Adjusted EBITDA was $515 million, with profit margin at 31% and Adjusted EBITDA Margin at 56%.
• For the six months ended June 30, 2025, profit was $126 million and Adjusted EBITDA was $306 million, with profit margin at 24% and Adjusted EBITDA Margin at 57%.
• The ongoing war in Ukraine has caused disruptions, including physical damage to infrastructure (5.3% damaged/destroyed, 82% restored as of Dec 31, 2024), increased operating costs ($45.3 million in 2024 for security, fuel, batteries), and customer migration.
• A cyber-attack on December 12, 2023, caused temporary service disruptions and resulted in an estimated $23 million impact on operating revenue in 2023 and $46 million in 2024 due to customer appreciation programs.
• Kyivstar acquired 97% of Uklon, a ride-hailing and delivery platform, for approximately $158 million in April 2025, and increased its stake in Helsi, a digital healthcare platform, to 97.99% in May 2025.
• VEON beneficially owns approximately 89.6% of Kyivstar Group Ltd.'s outstanding common shares, making it a controlled company under Nasdaq rules.
• The Company and VEON jointly intend to invest $1 billion in Ukraine between 2023 and 2027, focusing on network development, energy resilience, technological leadership, digitalization, and strategic acquisitions.
• As of June 30, 2025, total assets were $1,940 million, and total equity was $1,221 million. Total debt and derivatives were $413 million, down from $894 million at December 31, 2024, due to bond repayments.

Sentiment

Score: 6

Explanation: The filing presents a mixed but cautiously optimistic outlook. While the company demonstrates strong operational resilience and profitability despite the war, and has made strategic acquisitions and significant debt repayments, the 'going concern' emphasis and numerous risks related to the war, sanctions, and regulatory environment in Ukraine introduce substantial uncertainty. The positive financial performance and strategic growth initiatives are strong, but the external geopolitical and economic factors in a frontier market temper the overall sentiment.

Positives

• Maintained strong operational efficiency and profitability through the war in Ukraine, with Adjusted EBITDA Margin at 56% in 2024 and 57% in H1 2025.
• Leading provider of mobile communication (over 23 million customers) and fixed broadband services (over 1.1 million subscribers) in Ukraine as of December 31, 2024.
• Successful strategic acquisitions, including a controlling stake in Helsi (digital healthcare) and 97% of Uklon (ride-hailing/delivery), diversifying digital service offerings.
• Significant investment in network infrastructure and resilience, including 2,617 new sites and 4,512 mobile settlements since 2022, and installation of 2,600 generators and 176,000 additional batteries.
• Launched high-speed Gigabit Passive Optical Network (GPON) in December 2023, enhancing network resilience during power outages.
• Signed an agreement with Starlink in December 2024 to introduce direct-to-cell satellite connectivity in Ukraine, enhancing resilience and planning for SMS/OTT messaging, voice, and data services.
• Acquired 2x5 MHz spectrum in the 2100 MHz band and 40 MHz spectrum in the 2300 MHz band in November 2024, investing UAH 1.43 billion ($34 million) to boost spectrum holding.
• Strong customer loyalty and retention efforts, including the 'Roam Like at Home' offering, which generated revenue in hard currencies from international operators.
• Experienced leadership team with a proven track record in navigating challenging operating environments, maintaining an 86% employee engagement rate in 2024.
• Commitment to invest $1 billion in Ukraine between 2023 and 2027, signaling long-term confidence in the country's recovery and digital ecosystem development.
• Repaid April 2025 and June 2025 bonds totaling $572 million in H1 2025, significantly reducing debt and derivatives liabilities from $894 million to $413 million.

Negatives

• The ongoing war in Ukraine has caused significant disruptions, including physical damage to infrastructure, increased operating costs, and customer migration, leading to a loss of up to 3.1 million subscribers from January 2022 to December 2024.
• The cyber-attack in December 2023 resulted in temporary service disruptions and an estimated $69 million impact on operating revenue across 2023 and 2024 due to customer appreciation programs.
• The independent auditors included a 'going concern' emphasis paragraph due to material uncertainties related to the war, potential sanctions, and the ability to maintain the customer base and operate as a going concern.
• Restrictions applicable to all foreign-owned companies in Ukraine have limited the upstreaming of dividends and making certain payments abroad, impacting liquidity and financial flexibility.
• Suffered reputational harm due to the association of certain beneficial owners of VEON's largest shareholder (LetterOne) with sanctions, leading some multinational companies to cease transacting with Kyivstar.
• Increased operating costs due to inflationary pressures, such as a 27.3% increase in blended electricity tariff in 2024, and higher fuel prices.
• Decline in revenue from international mobile termination rates (MTRs) due to EU policies regulating roaming charges for Ukrainians, which are expected to continue.
• The Company's primary source of revenue is from prepaid mobile customers who are not on long-term contracts, leading to unpredictable revenue performance.
• The Ukrainian market is a 'frontier market' subject to greater risks, including political and economic instability, regulatory and legal uncertainty, social unrest, and conflict.
• The Company is exposed to foreign currency exchange loss and volatility, particularly with the Ukrainian hryvnia, which can impact U.S. dollar-denominated results and debt repayment.
• The Company's liquidity condition as of June 30, 2025, for Cohen Circle, raised substantial doubt about its ability to continue as a going concern if the Business Combination was not successful.

Risks

• Risks relating to the ongoing war in Ukraine, including adverse impact on economic conditions, physical damage to property, infrastructure and assets, effect of sanctions and export controls on supply chain, volatility in Ukrainian hryvnia, ability to operate and maintain infrastructure, and increased risk of nationalization.
• Risks related to JSC Kyivstar's ability to declare and pay dividends and restrictions on its ability to make certain payments abroad due to martial law and other legal restrictions in Ukraine.
• Risks related to Kyivstar Group Ltd.'s principal asset being its interest in JSC Kyivstar, and its dependence on JSC Kyivstar for distributions, which may be restricted or prohibited.
• Risks related to work stoppages and other labor matters, including mobilization of employees for military service.
• Risks related to investing in frontier markets, which are subject to greater risks than developed markets, including political and economic instability, regulatory and legal uncertainty, social unrest and conflict.
• Risks associated with cyber-attacks or systems and network disruptions, data protection, data breaches, or the perception of such attacks or failures, including costs and reputational harm.
• Risks relating to the international economic environment, inflationary pressures, geopolitical developments and unexpected global events, impacting operating costs and customer spending.
• Risks related to the ability to grow communications and digital service offerings, including demands on management, need for approvals, and challenges of integrating acquired businesses.
• Risks related to the impact of export controls, international trade regulation, customs and technology regulation on macroeconomic environment, operations, and ability of key third-party suppliers to procure goods, software or technology.
• Risks relating to legislation, regulation, taxation and currency, including costs of compliance, currency and exchange controls, currency fluctuations, and abrupt changes to laws, regulations, decrees and decisions governing the telecommunications industry and taxation, laws on foreign investment, anti-corruption and anti-terror laws, economic sanctions, import tariffs and restrictions, data privacy, anti-money laundering, antitrust, national security and lawful interception.
• Risks that adjudications, administrative or judicial decisions in respect of legal challenges, license and regulatory disputes, tax disputes or appeals may not result in a final resolution in the Company's favor or that the Company is unsuccessful in defense of material litigation claims or unable to settle such claims.
• Risks relating to operations, including regulatory uncertainty regarding service offering, licenses and approvals, frequency allocations, constraints on spectrum capacity, access to additional bands of spectrum, intellectual property rights protection, interconnection agreements, equipment failures and competitive offering and pricing pressures.
• Risks related to developments from competition, unforeseen or otherwise, including the ability to keep pace with technological changes and evolving industry standards.
• Risks associated with the market price of common shares, which may be volatile or may decline regardless of operating performance.
• Risks related to status as a foreign private issuer, including following certain home country governance practices rather than Nasdaq requirements.
• Risks related to status as an emerging growth company, including reduced public company reporting requirements.
• Risks related to status as a controlled company, where VEON's majority ownership could limit other shareholders' influence.
• Risks that the Company may not be able to raise additional capital, or may only be able to raise additional capital at significantly increased costs.
• Risks that indebtedness and debt service obligations could decrease cash flow and adversely affect business and financial condition.
• Risks that the issuance of additional shares or other debt or equity securities could make it difficult for another company to acquire the Company, dilute ownership, and adversely affect the price of common shares.
• Risks that future resales of common shares by selling securityholders may cause the market price to drop significantly.
• Risks that certain individuals on the management team have limited experience in operating a public company.
• Risks of incurring increased costs and obligations as a result of being a public company.
• Risks that the Company could cease to be considered a passive foreign investment company (PFIC) for U.S. federal income tax purposes, resulting in adverse U.S. federal income tax consequences to U.S. investors.

Future Outlook

Kyivstar Group Ltd. expects to continue facing challenges due to the ongoing war in Ukraine, including foreign currency volatility, infrastructure damage, customer loss, and sanctions. However, the Company anticipates future growth as the Ukrainian economy recovers, leveraging its loyal customer base and strategic investments. It aims to deepen mobile market leadership, expand digital service offerings through acquisitions and organic growth (e.g., AI/Generative AI solutions, cybersecurity integration), maintain and grow its multiplay subscriber base, and increase average revenue per user (ARPU) to levels comparable to Central and Eastern European nations. The Company and VEON jointly intend to invest $1 billion in Ukraine between 2023 and 2027, focusing on network development, energy resilience, technological leadership, and digitalization. The Company expects capital expenditures to remain elevated in the near term due to these initiatives.

Management Comments

• Our margins and Adjusted EBITDA have remained strong through the war in Ukraine, due to our focus on customer retention and continuity of service during this period.
• We believe our diverse multiservice product offering, combined with our high network reliability, fosters customer loyalty and supports our premium pricing strategy.
• We believe the Starlink service will enhance the resilience of Ukraine's connectivity landscape.
• We believe the average mobile ARPU in Ukraine is relatively low and has the potential to increase to levels comparable to ARPU levels in Central and Eastern European nations.
• We aim to further increase the ARPU for our customers by introducing premium services and upselling existing offerings.
• We expect to provide a unique opportunity for international investors to participate in the country's recovery through investment in Kyivstar.
• We expect capital expenditures to remain elevated in the near term.

Industry Context

Kyivstar operates in a highly competitive Ukrainian telecommunications market, characterized by fragmentation in fixed broadband (almost 2,000 operators) and strong competition in mobile (Vodafone, Lifecell). The industry is undergoing rapid technological evolution (4G/5G rollout) and increasing demand for digital services. The ongoing war in Ukraine significantly impacts the industry, causing infrastructure damage, population shifts, and regulatory uncertainties, while also driving demand for resilient connectivity solutions. Kyivstar's strategy of diversifying into digital health (Helsi), ride-hailing (Uklon), and big data/cloud services aligns with broader global trends of telecom operators expanding beyond core connectivity into adjacent digital ecosystems. Its focus on multiplay offerings and network resilience is critical for retaining customers and driving ARPU growth in a challenging environment. The company's listing on Nasdaq positions it as a unique investment opportunity for those seeking exposure to Ukraine's post-war recovery and digital transformation.

Comparison to Industry Standards

• Kyivstar's average monthly ARPU in mobile services was $2.8 in the nine months ended September 30, 2024, which is significantly lower compared to the average monthly ARPU across Mobile Network Operators (MNOs) in selected Central and Eastern European countries of $10.7, indicating potential for ARPU growth.
• Kyivstar's LTE population coverage of approximately 96% as of December 31, 2024, demonstrates a strong network presence, comparable to leading operators in developed markets.
• The Ukrainian fixed broadband market is highly fragmented with almost 2,000 operators; Kyivstar's 14% market share by access lines (as of Dec 31, 2024) positions it as a leader, but still leaves significant room for consolidation compared to more concentrated markets globally.
• Kyivstar's employee engagement rate of 86% in 2024, according to a third-party survey, is considered high and compares favorably to typical industry benchmarks, especially given the challenging operating environment in Ukraine.
• The company's investment of UAH 1.43 billion ($34 million) in spectrum acquisition in November 2024, as part of a $1 billion joint investment intention with VEON, reflects a commitment to infrastructure development that is substantial for a frontier market.

Management Changes

Corporate Governance

Legal Proceedings

• A claim filed in 2016 by the Ukraine Tax Authority alleging an additional charge of taxes and penalties of approximately $33.9 million for the years 2009 to 2014, related to a contractual relationship with Private Enterprise Wholesale Company Elbrus, is pending in the court of first instance.
• A criminal proceeding by the Security Service of Ukraine (SSU) related to the December 2023 cyber-attack, in which Kyivstar has been identified as the victim, remains open as of the date of this prospectus.
• In April 2024, the Ukrainian custodian of VEON's shares in JSC Kyivstar marked all VEON's shares as non-voting, citing the freezing order (now lifted) and sanctioned individuals being ultimate beneficiaries or indirect owners. This issue is ongoing.

Related Party Transactions

• Kyivstar predominantly uses the network infrastructure of Ukraine Tower Company (UTC), a wholly-owned subsidiary of VEON. In 2024, Kyivstar paid $61 million in fees to UTC under a Material Lease Agreement (MLA), which has an initial term of seven years with renewal options.
• JSC Kyivstar provides certain shared services (accounting, legal, treasury, etc.) to UTC under service agreements, and UTC compensates JSC Kyivstar for these human resources costs.
• Under a Framework Sale and Purchase Agreement (Framework SPA), JSC Kyivstar sells equipment to UTC. In 2024, UTC paid Kyivstar approximately $10.8 million under this agreement, which was extended until at least March 31, 2026.
• VEON Ltd. provides Kyivstar with general support services (technical, commercial, legal, tax, HR) under a service agreement extended through December 31, 2028. Kyivstar settled approximately $2.6 million with VEON in 2024 using credit funds.
• VEON Wholesale Services B.V. (a VEON subsidiary) provided international roaming and telecommunications services to Kyivstar under an agreement terminated March 31, 2024. Kyivstar paid VEON approximately $4.4 million in 2024 for these services.
• VEON Ltd. entered into an agreement with Impact Investments LLC (Executive Chairman Michael R. Pompeo, a Kyivstar Group Ltd. director) for strategic support and board advisory services. In 2024, $0.4 million cash expense and $7 million share-based payment expense were recognized.
• JSC Kyivstar has a services agreement with Delta Strategy & Ventures LLC (CEO Dmytro Shymkiv, a Kyivstar Group Ltd. director) for strategic support and board advisory services, with cash payments of approximately $136,500 in 2024 and $100,300 through April 25, 2025.
• Loan receivable from VEON Amsterdam B.V. of $41 million as of June 30, 2025, reflects a related party loan to cover potential future bond repayments.
• Other investments at amortized cost include interest-free financial aid provided by Uklon Group to former shareholders in the amount of $6 million as of June 30, 2025.
• Other financial liabilities include a long-term financial interest-free loan of $5 million received from UTC, a related party, with maturity on May 30, 2027.

Stakeholder Impact

• **Shareholders:** Potential for long-term growth through strategic investments and market leadership, but exposed to high risks from the war in Ukraine, potential nationalization, and volatility in share price. VEON's majority ownership limits influence of other shareholders. Future capital raises could dilute ownership.
• **Employees:** Safety and well-being are a priority, with emergency support, hybrid/remote work options, protective equipment, safety training, and psychological support programs implemented. However, risk of work stoppages and loss of key personnel due to mobilization efforts in connection with the war.
• **Customers:** Continued focus on customer retention and continuity of service, including 'Roam Like at Home' offers. Expansion of digital services (Helsi, Uklon, Kyivstar TV) aims to enhance value proposition. Cyber-attacks can disrupt services and erode trust. Inflationary pressures may affect purchasing power and demand for services.
• **Suppliers:** Dependence on third parties for services and equipment, with risks of supply chain disruptions due to war, sanctions, and export controls. Some partners have expressed hesitancy to transact due to perceived affiliations with Russia.
• **Creditors:** Indebtedness and debt service obligations could decrease cash flow. While bonds were repaid, the 'going concern' uncertainty and currency restrictions in Ukraine could impact the ability to meet future obligations or raise additional capital on favorable terms.
• **Regulatory Authorities:** Subject to extensive and evolving telecommunications, data privacy, anti-corruption, and tax laws. Non-compliance could result in fines, license suspension/revocation, and reputational damage. The war has introduced additional regulatory complexities and risks of nationalization.

Next Steps

• Kyivstar Group Ltd. Common Shares and Warrants commenced trading on the Nasdaq Stock Market under symbols KYIV and KYIVW on August 15, 2025.
• The Company expects to use net proceeds from warrant exercises for general corporate purposes.
• Kyivstar anticipates launching Starlink direct-to-cell services with SMS and OTT messaging functionality in Q4 2025, with plans to expand to voice and data in later stages.
• The Company plans to actively participate in upcoming spectrum auctions (if any) to expand network capacity and enhance service quality.
• Management will continue to work with local custodians to remove any remaining restrictions on corporate rights in JSC Kyivstar and its Ukrainian subsidiaries.
• The Company intends to pursue additional acquisitions and make targeted capital expenditures over the next few years, focusing on expanding network infrastructure, enhancing service capabilities, and supporting long-term growth.
• The Company will continue to implement remediation and mitigation actions to reduce current cybersecurity risks and establish a robust framework to manage evolving cyber threats.
• Negotiations on a collective agreement with the Trade Union Committee of the Primary Trade Union Organization (Nash Kyivstar) are expected to continue after the end of the state of war.

Key Dates

Recommendation

Kyivstar Group Ltd. presents a compelling long-term growth story as Ukraine's leading telecommunications and digital services provider, with strong operational efficiency and strategic expansion into high-growth digital sectors like e-health and ride-hailing. The company's commitment to investing $1 billion in Ukraine and its successful Nasdaq listing offer unique exposure to the country's recovery. However, the 'going concern' emphasis from auditors, the severe and unpredictable impacts of the ongoing war in Ukraine (including infrastructure damage, customer migration, and nationalization risks), and the reputational and operational challenges stemming from sanctions on VEON's beneficial owners introduce substantial near-term uncertainty and high risk. While the recent debt repayments are positive, the stock is best held by investors with a high-risk tolerance and a long-term view on Ukraine's recovery, as the immediate future remains highly volatile and subject to geopolitical developments beyond the company's control. A 'hold' recommendation acknowledges the strong underlying business and strategic initiatives while recognizing the significant, unquantifiable external risks.

Keywords

Telecommunications, Ukraine, Digital Services, Mobile Network Operator, Broadband, SEC Filing, Nasdaq Listing, Business Combination, Cybersecurity, War Impact, Emerging Growth Company, Foreign Private Issuer, Controlled Company, Spectrum Acquisition, Uklon, Helsi, VEON