Telcom Armenia Secures Loan Amid War Crisis

On October 29, 2020, the company "Tim" LLC, founded by brothers Haik and Alexander Yesayan, who separated from the "Ucom" company owned by Gagik Khachatryan's sons, acquired 100% of the shares of "Veon Armenia" CJSC (brand name "Beeline"). As a result, "Veon Armenia" was rebranded as "Telcom Armenia," which will now operate under the brand "Beeline," effectively becoming the largest company in Armenia's strategic telecommunications sector alongside "ArmenTel." The deal had been initiated in July 2020 and was accompanied by scandals and intrigue.

The media has covered this topic extensively; we also reported that under the apparent protection of the authorities, the Yesayan brothers excluded Gagik Khachatryan's family, which owns and leads "Ucom," from the competition, established "Tim" LLC, and acquired "Beeline" through an inexplicably large loan. Therefore, the deal has several murky aspects, surrounded by notable events.

The Yesayan brothers kept the transaction price and the sources of financing secret for a long time. Reports suggested that they initially sought a loan from Ardshinbank, but the bank rejected their request. Eventually, "Tim" LLC successfully secured a loan from two banks: a small portion from Ardshinbank and the majority from Ameriabank. Notably, the transaction occurred on October 29, during the height of the war.

Sources indicate that bank management expedited the process for employees to hasten the deal, and the bank's council made a decision to grant the loan (the bank's council decisions can bypass standard loan issuance processes). This means that, in effect, the newly established company arranged one of the largest transactions in newly independent Armenia with nearly 100% financing, securing it in a strategic sector without additional collateral or guarantees.

To grasp this issue vividly, imagine a newlywed couple applying for a mortgage and receiving it on the spot, without a down payment or proof of income. They would receive not just one apartment but an entire residential building. And when people inquire about this miracle, the couple declares that "the building was given to us because we are a promising couple; moreover, until the mortgage is paid off, the building will be collateralized." However, until the mortgage is paid off, the property remains collateralized, prompting questions about how they resolved the down payment and employment verification.

The implications suggest there might have been direct state intervention. That is to say, during wartime, when citizens were assured of victory, did Nikol Pashinyan stand as a guarantor for the Yesayan brothers, enabling Ameriabank and Ardshinbank to issue loans? Moreover, this all occurred in secrecy. It has come to our attention that, as a result of direct or indirect government actions involving public regulation and control of infrastructures, a structure significantly backed with guarantees provided a large sum as "frozen" finances.

To secure the financing, the banks also employed their main tools; as a risk reduction measure, they considered the transfer of ownership rights to the bank(s) should the loan not be repaid. This situation does not necessarily relate to legally prescribed guarantees regarding the budgetary system, where such funds would represent state debt; instead, various government guarantee mechanisms could be in play. But what is Nikol Pashinyan's government’s interest in engaging in such a risky and contentious maneuver on behalf of a private company? The answer seems clear.

To avoid these speculations appearing baseless, we attempted to get comments from the Yesayan brothers at "Tim" LLC. We reached out to Alexander Yesayan, who informed us he was busy and would call back. Subsequently, Ashot Barseghyan, the company’s spokesperson, contacted us, stating that he was authorized to answer all our questions against our request for a direct statement from the top management. However, many pressing questions remained unanswered as it turned out he was not fully authorized to respond.

When asked about the transaction's value, Barseghyan said, "The value will be evident in the annual report. We have an agreement with Veon Armenia that we cannot disclose the value. They, being a publicly listed organization, consider any financial figure sensitive. They specify in their contracts that such information is not to be disclosed, and we agreed. A quarterly report will reflect those figures once the quarter closes."

In response to media reports suggesting the transaction value was $60 million, he claimed he couldn’t provide any comments on that either, although he confirmed the loans were obtained from Ameriabank with a smaller portion from Ardshinbank.

We reminded him of the previous difficulties in securing the loan, especially when Ardshinbank had initially rejected their application. He was asked who had served as a guarantor in securing the loan. He stated that the collateralization was based on the assets of "Veon Armenia," now "Telcom Armenia." He added that Haik Yesayan had often mentioned how typical mortgage securing works through property usage until the loan is closed.

Despite our insistence on information suggesting government mediation in this loan, he firmly asserted, "That's your information. I can’t comment on it." Inquires about any secret government documents to look at were categorically dismissed, calling the very existence of such documents impossible. When pressed about rumors regarding the government providing guarantees, he reiterated that no such guarantee exists and described the transaction as purely commercial.

The conversation led to him insisting that the concerns raised by our inquiry involve matters he cannot articulate. In the end, we agreed to send our questions in writing, but soon after, Barseghyan called back saying their definitive response was that it was complete falsehood that they had received guarantees from any state agency.

Alexander Yesayan later contacted us with a threatening tone warning, "If you print false information about us, we will file a lawsuit and seek absolute retraction." We replied that while they have every right to pursue legal action, we also have the right to inform the public of the information we have received, especially concerning the actions of their chosen authorities and any shadowy dealings.

During this period, we sought comments from the Central Bank regarding the freezing of funds equivalent to the guaranteed loan. They stated that they were unaware of the details but noted that the Central Bank merely intermediates between the state and the private sector. Thus, if any action were taken, it would likely be based on a government decision.

We will continue to investigate the full truth while emphasizing our skepticism towards fairy tales. We understand that the acquisition process of "Veon Armenia" or "ArmenTel" may have been facilitated with additional guarantees (collateral, extra financing, etc.), which could deem government involvement illegal. Another possibility raises national security concerns due to potential undisclosed beneficiaries supporting financial arrangements for "Telcom Armenia" (formerly "Beeline").