{ "docId": "019dd923-622c-750b-8b96-5a94b5d7e084", "docSlug": "fcfc0434b622", "documentTitle": "TeliaSonera AB (TLSN)", "authorId": "51_Muddy_Waters", "authorName": "Muddy Waters", "documentKindSlug": "shareholder-letter", "documentKindLabel": "Shareholder letter", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2015-10-15 00:00:00", "orientation": "portrait", "aspectRatio": 0.77272725, "pageNumber": 19, "pageCount": 37, "prevPage": 18, "nextPage": 20, "slideType": "appendix_disclosure", "function": "expose_contradiction", "density": "overcrowded", "nDataPoints": 2, "notes": "This page serves as a disclosure/evidence page for a shareholder letter, focusing on investigative journalism reports regarding corruption.", "elementsJson": [ "paragraph", "footnote" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b96-5a94b5d7e084/19", "deckHref": "/decks/019dd923-622c-750b-8b96-5a94b5d7e084", "deckJsonHref": "/decks/019dd923-622c-750b-8b96-5a94b5d7e084.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b96-5a94b5d7e084#slide-19", "components": [ { "bbox": null, "kind": "callout", "text": "Our tally of payments Telia made to suspect counterparties in Azerbaijan in often commercially questionable transactions is SEK 9.1 billion (US$1.1 billion).", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-78b7-702e-9637-10f8d6045e06", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "metric", "text": "EBITDA: SEK 9.1 billion", "attrs": null, "subkind": "primary", "toolName": "Quantification", "toolSlug": "quantification", "confidence": null, "componentId": "019dd953-78b7-702e-9637-1b34341334de", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.72, "x": 0.14, "y": 0.35 }, "kind": "paragraph", "text": "Both the scandals in Uzbekistan and Azerbaijan were triggered by investigative journalism. However, the Azerbaijan scandal came to light nearly two years after Uzbekistan, and exemplifies the degree to which the Company has yet to publicly come to terms with the depth and breadth of problems in its Eurasia businesses. As of September 17th of this year, the Company maintains that it \"still does not know the UBO\", the ultimate beneficial owner of its local partners in both Uzbekistan and Azerbaijan.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "4b2fbb87-bf54-47ed-83cf-144300ff1b4b", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.72, "x": 0.14, "y": 0.48 }, "kind": "paragraph", "text": "Azeri investigative reporter, Khadija Ismayilova, reported that the ultimate beneficial owners of Telia's \"Local Partner\" in Azerbaijan are likely President Aliyev's daughters Arzu and Leyla Aliyev. In July 2014 Ismayilova published evidence that convincingly links Telia; its new \"local partners\" in Azertel, a Turkish company called Cenay Iletishim; and Panamanian holding companies likely belonging to the Aliyevs. Accompanying her report was a separate site listing and linking key source material made available for public review.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "74317056-b693-4d88-ba0d-98654754d5cf", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.16, "w": 0.72, "x": 0.14, "y": 0.61 }, "kind": "paragraph", "text": "TeliaSonera was not ignorant of her efforts. As can be seen in the copies of her emails and letters posted in her \"reports notes,\" Ismayilova made multiple attempts to contact the Company and its partners. Between April 11 and April 15 of 2014 she was engaged with correspondence with Salom Bekele, TeliaSonera's Head of External Communication, regarding questions about the Azercell privatization and Cenay Illetism's connection to President Aliyev's family. Mr. Bekele responded by referring her back to Telia's Eurasia Factbook and the Chairman Ehrling's speech at the 2014 AGM. She also specifically queried about Oliver Mestelan, who could be a proxy for the first family, in its capacity as both a board member of Azertel and corporate secretary", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "8e68bda1-0ba3-4133-99f8-1a8be61feee4", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.25, "w": 0.72, "x": 0.14, "y": 0.09 }, "kind": "paragraph", "text": "Azerbaijan is one of TeliaSonera's top performing Eurasian assets. In FY 2014 it produced SEK1.916 billion in EBITDA with an EBITDA margin of 50.7%. In Azerbaijan, as with Uzbekistan and other Eurasian markets, the Company appears to have been content to feign ignorance of corruption in its business dealings with its local business partners until scandal broke and forced its hand. In May of 2015, OCCRP journalists published a detailed report alleging Telia was a knowing participant in a series of transactions that included misappropriation of state assets, massive kick-backs, and illicit payments to a network of companies and proxies whose ultimate beneficial owners appear to be the daughters of President Aliyev's family as well as other advisors and front men. Our tally of payments Telia made to suspect counterparties in Azerbaijan in often commercially questionable transactions is SEK 9.1 billion (US$1.1 billion).", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "a2b0b776-d1f2-415e-a4bc-a358441ff363", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "the Company maintains that “still does not know the UBO”, the ultimate beneficial owner of its local partners in both Uzbekistan and Azerbaijan.", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-78b7-702e-9637-15e538271cc6", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.72, "x": 0.14, "y": 0.78 }, "kind": "source-note", "text": "77-83: References to financial data, OCCRP reports, conference calls, and investigative journalism source material.", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "7f7a73c6-1e0b-468e-949e-1cf0cb0dc097", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [ { "name": "Audience Definition", "slug": "audience-definition", "agent": "Storyteller", "layer": "slide", "matchId": "ab4e809b-619e-4d76-955b-4a8f6ff70664", "evidence": "Azerbaijan is one of TeliaSonera's top performing Eurasian assets.", "confidence": 0.7 }, { "name": "Credibility Transfer", "slug": "credibility-transfer", "agent": "Storyteller", "layer": "slide", "matchId": "6a1ad114-86bc-4e1c-b2f0-1647fc23d8fa", "evidence": "Khadija Ismayilova, reported that the ultimate beneficial owners of Telia's \"Local Partner\" in Azerbaijan are likely President Aliyev's daughters Arzu and Leyla Aliyev.", "confidence": 0.6 } ], "frameworks": [ { "name": "fraud-exposure", "slug": null, "matchId": "3ad2621e-0a55-4a52-87a4-ebdaaf301c1f", "evidence": "The slide details specific allegations of corruption, misappropriation of assets, and illicit payments involving corporate entities and political figures.", "confidence": 0.9 } ], "arcBeats": [ { "to": 20, "from": 16, "beatId": "6d91daaf-c3a9-43b1-b4d5-eef0e0f12964", "arcName": "Overcoming the Monster", "arcSlug": "overcoming-monster", "beatName": "The Call", "beatSlug": "overcoming-monster-the-call", "evidence": "Call to action for the board and management to address the issues", "position": 2, "confidence": 0.8, "parentBeatName": "Complication", "parentBeatSlug": "complication" } ], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }