OTE and government relaxed about sell-off plans

21 Apr 2006

The CEO of Greek fixed line incumbent OTE, Panagis Vourloumis, told the Financial Times this week that his company is under no pressure to find a strategic investor, despite several international telecoms groups and funds showing interest in buying the Greek government’s 36% stake. In March 2006 the state ruled out a sale of its stake in OTE before the year’s end, when Finance Minister George Alogoskoufis dismissed rumours about three foreign private equity funds’ interest in the telco. However, it is widely expected that a government plan to further privatise OTE will go ahead before 2008. Several European telecoms groups, including Deutsche Telekom, are also understood to have made recent approaches to the government, but the Finance Ministry played this down, insisting that the country’s current EUR1.6 billion privatisation programme does not include an ‘opportunistic’ telecoms sell-off.

Last week OTE completed a series of deals to raise its stake in its mobile arm Cosmoté by over 2.5% to 67%, prompting speculation that the telco planned to gain complete control of the subsidiary before the end of 2006 in preparation for a full privatisation. However, according to Mr Vourloumis, acquiring all shares in the cellco is not an immediate priority. He added: ‘We want to ensure full control of Cosmoté, but there are several other items on the agenda…Seeking a strategic investor could be some way off.’

In addition to its 36% direct stake in OTE, the state controls a 3% share through Hellenic Exchangeable Finance. The remainder is distributed between international institutional shareholders (39%), Greek institutional shareholders (12%) and others (10%).

Greece, Cosmote