#1Telia Company TELIA COMPANY DIVESTS ITS INTEREST IN KCELL & DISMANTLES THE FINTUR HOLDING STRUCTURE December 12, 2018#2COMPLETING EURASIA EXIT IN ALL MATERIAL ASPECTS Before announcement today ✓ Five countries sold MegaFon fully divested ✓ Direct stake in Turkcell sold Well-functioning Ethics and Compliance implemented Global settlement around Uzbekistan reached in September 2017 After announcement today Kcell agreement signed with cash proceeds of SEK 4.1 billion (Telia Company's share SEK 2.9bn) Fintur holding structure dismantled - cash to be fully distributed to Telia Company Continuing operations Assets divested Assets partly divested Moldcell only remaining asset - representing an immaterial part of Telia Company (0.6% group EBITDA)#3TRANSACTION HIGHLIGHTS - KCELL 3 Rationale Target company Valuation Financial effects Time table The final big step in our effort to over time leave Eurasia Telia Company's direct and indirect ownership in Kcell Telia Company has sold its 24 percent direct ownership in Kcell to Kazakhtelecom JSC. Simultaneously, Fintur Holding, jointly owned by Telia Company and Turkcell, has sold its 51 percent ownership in Kcell to Kazakhtelecom JSC The price for the 75 percent is USD 446 million (our part USD 326 million) which implies a full enterprise value of USD 771 million, equal to EV/EBITDA of 5.0x, slightly above peers The transaction is expected to result in a gain of c. SEK 1.1 billion for Telia Company before reclassification of accumulated foreign exchange losses of SEK 0.9 billion to net income from discontinued operations (which will have no material effect on group equity) Net debt to EBITDA to decrease by 0.1x The Kazakh competition authority has already approved the transaction and closing of the transaction is expected during December 2018#4TRANSACTION HIGHLIGHTS - FINTUR 4 Rationale Target company Valuation Financial effects Time table ● ● ● ● ● Dismantling of the Eurasia holding structure Fintur Holding BV where Telia Company held 58.55 percent and Turkcell 41.45 percent Telia Company acquire Turkcell's share of Fintur's cash The total cash position in Fintur was approximately SEK 6.1 billion million by the end of November which will be split proportionally whereby Telia pays 95% on the cash value to Turkcell for their part. In total Telia keeps approximately SEK 3.7 billion plus its proportional part of the proceeds from Kcell The transaction is not expected to result in any impact on net income in discontinued operations No impact on net debt to EBITDA Cash in Fintur will be distributed to Telia Company The transaction has been agreed today. Fintur closing is expected to early 2019#5NET INCOME IMPACT - KCELL IMPACT ON NET INCOME SEK in billions, based on Telia Company's share 1.1 Capital gain -0.9 Recycled FX effects (imaterial equity impact) 0.2 Net effect on net income in discontinued operations SEK 0.2 billion positive impact on Telia Company's net income as a SEK 1.1 billion capital gain is largely offset by SEK 0.9 billion in FX recycling#6LEVERAGE IMPACT - UCELL, KCELL & FINTUR IMPACT ON NET DEBT & LEVERAGE SEK in billions, reported per Q3 2018 and pro forma 1.1X 31.8 Net debt Q3 2018 0.1X 0.6 Ucell net =leverage -0.1X -4.1 Kcell net* 6 *Excluding Turkcell's share of proceeds 0.0X 2.4 Fintur net 1.1X =leverage impact 30.6 Proforma net debt Q3 2018 ● Ucell was sold on 5 December 2018 Limited impact on net debt and leverage from the divestments of Ucell and Kcell as well as the holding structure dismantling#7SHAREHOLDER STRUCTURE PRE TRANSACTION Turkcell Free float London & Almaty 7 24.02% 41.45% Fintur Holdings BV 25.0% Telia Company AB 58.55% 51.0% Kcell 100% TS Kazakhstan Holding BV 24.0% Shares sold POST TRANSACTION State of Kazakhstan Samruk Kazyna 51% Free float London & Almaty Telia Company AB Other owner Kazakh- telecom JSC 25.0% 25% 100% Free float 75.0% Kcell 24% Fintur Holdings BV ● Kazakhtelecom JSC acquires Telia Company AB's 24% direct ownership and Fintur Holding BV's 51% holding in Kcell Fintur Holding BV was pre the transaction jointly owned by Telia Company (58.55%) and Turkcell (41.45%) Post transaction Fintur Holdings is 100% owned by Telia Company#8COMPLIANCE REVIEW AND DUE DILIGENCE OF BUYER 8 Compliance and responsible business Due diligence ● ● ● ● Kcell has over the years implemented a well-functioning Ethics and Compliance function and necessary processes and procedures to manage the key Ethics and Compliance risks A Human Rights Impact Assessment of our operations in Kazakhstan has been conducted The purchasing entity has undergone a thorough due diligence process, conducted by both internal and external expertise Key individuals and counterparts have been screened Anti-money laundering control over source and flow of funds has been conducted#9ETHICS AND COMPLIANCE IMPROVEMENTS ● ● ● ● ● Operations designed to be managed as a responsible business with corporate governance and control processes as a strong foundation Established adequate local competence and resources; professional management, anti- corruption certified officers Extensive training for all employees in Anti Bribery and Corruption as well as ethical way of working New way of working with suppliers and other third parties Responsible Business risks identified and actions taken Speak-up line established Human Rights Impact Assessment performed resulting in a number of implemented activities#10#11ANOTHER PROOF-POINT OF OUR STRATEGY TO FOCUS ON THE NORDICS AND BALTICS Date December 2015 April 2017 May 2017 September 2017 October 2017 October 2017 January 2018 March 2018 December 2018 December 2018 11 Company Ncell Tcell Turkcell Turkcell MegaFon MegaFon Geocell Azercell Ucell Kcell Amount SEK 9,100 million SEK 238 million SEK 4,426 million SEK 4,127 million SEK 3,200 million SEK 8,600 million SEK 700 million SEK 1,600 million SEK 1,950 million SEK 7,000 million Valuation Enterprise value Enterprise value Equity value Equity value Equity value Equity value Enterprise value Enterprise value Equity value Enterprise value#12TELIA COMPANY ADVISORS SULLIVAN & CROMWELL LLP Morgan Lewis HOUTHOFF BURUMA UBS Deloitte. 12 Control Risks Lead transaction counsel Legal counsel (Kazakh legal counsel) Legal counsel (Dutch legal counsel) Lead transaction advisor Financial advisor (Due diligence) Ethics & Compliance advisor ● Due to the nature of the transaction with several parties involved, Telia Company has (in addition to internal resources) engaged a number of reputable advisors