Play

"for a company that I bought at a valuation of $20 million in 1999 and sold when it had revenues of almost $2.5 billion 13 years later. I originally put only $4.5 million into a privatisation of a company with revenues of $100 million. I am still a shareholder and now have a stake of just under 2 per cent in a company worth about $60 billion. So Play represents my entrepreneurial side and Actavis my financial engineering side, with mergers and acquisitions always at the fore."

"Play reminds me of Bravo, my Russian beer company, in its early days. Both are consumer companies that are youth-oriented in their users and their employees. Their advertising is similar. They have hungry young sales people, and even the same kinds of offices. The atmosphere is frugal and energetic. Play is still a start-up growing at double-digit percentage rates, though the bond issue means it now has to slow down the growth and become more profitable."

"I needed to put more money into the business, by far one of the biggest companies in Iceland, so that it wouldn’t be taken over by Deutsche Bank. We had assets enough, and were working on selling them, but for the time being we had liquidity problems, so I borrowed €150 million from Landsbanki in March 2008 to rescue Actavis and fund salaries. This is what I was most criticised for in Iceland after the crash. ‘How could you borrow this in September 2008?’ my detractors cried. But I had started the process in March, borrowing in monthly instalments, with the last and largest payment coming in September. I gave a personal guarantee against the borrowings and, most importantly, that guarantee involved me pledging my holdings in Play, the Polish telecoms company, which was my most valuable and debt-free asset. Even so, the loan proved insufficient to get Actavis back on track and we were still busy scuttling around when the financial crash struck."

"But of course the moment I was seen to be back in the game, the calls began again. For me, it happened suddenly, almost as if it was on the flip of a coin. In late 2013, Jamie Dimon, chief executive of JP Morgan, rang me and said that he was personally at my disposal if I needed any help with a $1 billion bond issue being undertaken by Play, the Polish telecoms operator that I had set up back in 2005. The bank was very keen to handle it, and we were glad to oblige. Then I got a call saying the same thing from Brian Moynihan, chief executive of Bank of America. JP Morgan and Merrill Lynch ended up getting the mandate to act for Play on the bond issue. And as part of the process, which other global bank should be back at my office offering to lend us $1 billion but Deutsche Bank? That was ironic. Some of the bankers we dealt with this time were the same ones who had put all that debt into Actavis, very nearly losing a good deal of it. I rang them to say that they weren’t going to get the bond issue mandate, and then got a text message back saying that they were prepared to underwrite the whole issue. I couldn’t believe they were prepared to do the same thing that ended up with us both in trouble the last time we did a deal together."

"Mobile telecoms was a sector I knew well, having grown Play, my start-up in Poland, into a top-four independent challenger brand, and although Chile was on the other side of the Atlantic, it did bear some similarities to Play’s Polish homeland. Both were Catholic cultures with a high degree of conservatism. Another element they had in common was their domination by international behemoths. While Play in Poland was up against France’s Orange, Deutsche Telekom’s T-Mobile and Polkomtel, whose Plus brand was 24 per cent owned by Britain’s Vodafone, Nextel Chile had to contend with Entel, the former nationalised Chilean telecoms company whose 127-metre Torre Entel literally towers over central Santiago. Entel controlled about 30 per cent of the Chilean mobile telecoms market. Then there were Movistar, owned by Spanish giant Telefonica, which held a market share of around 28 per cent, and Claro, part of the America Movil telecoms giant, famously fronted by Mexican billionaire Carlos Slim, which had 23 per cent. Nextel Chile had possessed about 2 per cent of the market as a total underdog, and even that was falling steadily. However, we had grown Play from nothing into the leading mobile telecoms company in Poland with a 27 per cent market share, and we saw a similar potential growth trajectory for this Chilean minnow. The financial elements of a deal had to be put together very quickly. We completed the whole transaction in about two months and it was only later that we learned how close Nextel Chile had actually been to bankruptcy wipe-out. We refinanced the company with $400 million of equity and $420 million of debt and set about finding a way to rebrand and reposition it as a vibrant independent challenger brand – a far cry from its previous image as a distant South American offshoot of a major US carrier."

"Under our stewardship Play became the fifth-most-valuable brand in the country, greatly increasing the value of my 50 per cent holding. In the ten years since launch, Play gained more than 15 million subscribers, becoming Poland’s biggest mobile phone operator, with a 28 per cent subscriber market share. Novator led a flotation of Play on the Warsaw Stock Exchange in July 2017, with a market capitalisation of €2.2 billion. The company distributed more than €330 million in dividends over the following three years, and Novator fully exited in 2020, selling its remaining stake to French investor Iliad Group, led by Xavier Niel."

"Branding is a personal passion of mine, dating back all the way to the Bravo venture in St Petersburg, and it felt exciting and invigorating to be essentially building a start-up again. But what should we call our new baby? After discarding an initial notion to use the Play brand, we looked for a similarly dynamic name behind which to build a challenger, customer-centric culture and asked half a dozen marketing agencies to pitch their best ideas. None of them came up with anything that we liked, but another firm which had not been invited to pitch came up with a left-of-field suggestion that resonated with us straight away. Its concept was to brand the challenger around the ‘word-of-mouth’, viral way that we wanted to grow through personal recommendations offering great value and customer-centred service. ‘Word of mouth’ was shortened to WOM and that became our brand. My idea was to build a new Latin American challenger mobile telecoms brand using the playbook of Play in Poland and Nova in Iceland. I could use the same management team and external consultants who worked on both. The partners at Novator responsible for telecoms, who had worked with me since 2010, focused on financing the new venture and acquiring the necessary spectrum and telecoms licences. Chris Bannister, a personable Brit who became Play’s first chief executive in 2005 and had already lived and worked in nine countries, was brought back into the fold as chief executive. And the Icelandic chief technology officer oversaw the technical build-out design, along with his Swedish colleague. Members of our trusted teams from both countries helped in the beginning to transform a failed old-school US telecoms operator into a state-of-the-art ‘kick-ass’ mobile challenger. None of us spoke Spanish and most had never set foot in Latin America before, let alone Chile. It didn’t seem to matter. When we launched, Chile was the most expensive country in the Latin American region in mobile telecommunication, so we saw a market that was fertile for a new approach. Conventional new entrants like Nextel and a venture headed by US telecoms billionaire John Malone had failed to crack the nation. We needed to do things very differently. To achieve the maximum impact and truly disrupt the market, we knew that a key differentiator had to be price. Indeed, we priced our services so aggressively that Chile immediately became the cheapest country in South America for consumer mobile telephony. Alongside this value offer, we promoted WOM as an independent challenger offering honesty and integrity. We set out to be brave, innovative, bold and passionate."