Telenor ASA — M&A Activity 2014

Dec 3, 2014

TeliaSonera and Telenor combining forces Creating a new mobile contender in Denmark

Transaction highlights

• TeliaSonera and Telenor to merge Danish operations
• Ownership 50/50 based on equal valuation of respective operations
• Subject to approval from the European Commission
• Expected closing in 2015

Strategic rationale

Obtain a robust operator with significant efficiency gains

Improve customer experience

Establish an attractive position for future investments

Declining ARPU and low profitability for TeliaSonera and Telenor in Denmark…

Source: Company reported numbers

…and investments in the Danish telecom sector have declined by more than 30% over the last 5 years

Source: Danish Business Authority, "Okonomiske Nogletal for Telebranchen 2013"

Creating a robust mobile contender

* Source: Supporting data for Danish Business Authority report: "Telestatistik – andet halvår 2013". Retail mobile SIM market shares, including sub brands ** Source: Company reported numbers (last twelve months Q4 2013 – Q3 2014), subscription data end Q3 2014

50/50 ownership based on equal valuation of respective operations

Denmark	TeliaSonera FY 2013	Telenor FY 2013	TeliaSonera 9M 2014	Telenor 9M 2014
Net sales, DKK m	4,594	4,743	3,454	3,258
EBITDA*, DKK m	631	968	460	495
EBITDA margin, %	13.7	20.4	13.3	15.2
Mobile subscriptions, 000	1,522	1,828	1,566	1,929
Fixed internet/broadband subscriptions, 000	99	166	112	161
Fixed telephony subscriptions, 000	121	111	125	96

* TeliaSonera: EBITDA excl. non-recurring items, Telenor: EBITDA before other income and expenses

Governance structure

Operational autonomy

• Joint venture with 50/50 ownership
• Reported as an associated company by the owners
• Operated at an arm's length distance from the owners
• Strategy and financial targets to be approved by owners

• Option for owners to exit after two years through put mechanism

• Three Board representatives each to be appointed by Telenor and TeliaSonera

• Chair to be appointed unanimously by the parties
• CEO recruitment process to commence in due course

Targeting above DKK 800 million in annual efficiency gains

Summary

• TeliaSonera and Telenor to merge Danish operations
• Ownership 50/50 based on equal valuation of respective operations
• Aiming for annual efficiencies of at least DKK 800 million
• Subject to approval from the European Commission
• Expected closing in 2015

Disclaimer TeliaSonera

Statements made in this document relating to future status or circumstances, including future performance and other trend projections are forward-looking statements. By their nature, forwardlooking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There can be no assurance that actual results will not differ materially from those expressed or implied by these forward-looking statements due to many factors, many of which are outside the control of TeliaSonera.

Disclaimer Telenor

The following presentation is being made only to, and is only directed at, persons to whom such presentation may lawfully be communicated ('relevant persons'). Any person who is not a relevant person should not act or rely on this presentation or any of its contents. Information in the following presentation relating to the price at which relevant investments have been bought or sold in the past or the yield on such investments cannot be relied upon as a guide to the future performance of such investments.

This presentation does not constitute an offering of securities or otherwise constitute an invitation or inducement to any person to underwrite, subscribe for or otherwise acquire securities in any company within the Telenor Group. The release, publication or distribution of this presentation in certain jurisdictions may be restricted by law, and therefore persons in such jurisdictions into which this presentation is released, published or distributed should inform themselves about, and observe, such restrictions.

This presentation contains statements regarding the future in connection with the Telenor Group's growth initiatives, profit figures, outlook, strategies and objectives. All statements regarding the future are subject to inherent risks and uncertainties, and many factors can lead to actual profits and developments deviating substantially from what has been expressed or implied in such statements.