Mobtel to be sold in July

2 Mar 2006

Mobtel, Serbia’s state-owned wireless operator, will be offered for sale at a minimum price of EUR700 million, according to a statement by the government. The state’s 70% stake in Mobtel – which had around 2.3 million users at the end of September – will be sold via an open tender along with an operating license worth an additional EUR280 million, Finance Minister Mladjan Dinkic said. The auction will be finalised by early April with a sale expected to be completed by July.

The announcement that Mobtel is to be sold should end years of controversy over the ownership of the company. It was founded in 1994 as a partnership between Serbia’s state-run Telekom and billionaire businessman Bogoljub Karic. The entrepreneur’s original stake of 51% later came under scrutiny amid accusations that he dodged taxes, hid profits from his partner and made a number of allegedly damaging and illegal contracts. While that dispute awaited arbitration before a court in Switzerland, in May 2005 Karic sold his shares to an Austrian consortium led by investor Martin Schlaff. In December, the authorities took control of Mobtel and subsequently forged an agreement with Schlaff to clear Mobtel’s outstanding debt of EUR90 million to creditors as well as EUR30 million owed to Ericsson for equipment.

According to Minister Dinkic, Mobtel will ‘soon’ be 70% owned by state-run Telekom with the remainder held by the Schlaff Group. Combined proceeds from the sale of the government’s 70% stake and the licence should net ‘at least EUR600 million for state coffers.

Serbia, Telenor Serbia