Government sets USD2.4 billion starting bid for 68% of Ukrtelecom

10 Apr 2008

Ukraine’s Cabinet of Ministers yesterday approved a starting price of USD2.4 billion for the sale of a 68% state-held stake in incumbent fixed line operator Ukrtelecom, writes the Kyiv Post. The privatisation process is expected to be launched in the next few weeks, and is aimed at raising much needed funds for state coffers. However, Prime Minister Yulia Tymoshenko faces potential political conflicts over the sale, firstly with President Viktor Yushchenko, who favours a more cautious privatisation strategy, and secondly with the head of the State Property Fund, Valentyna Semeniuk, a survivor of the previous government who has stalled previous privatisations, according to the Post. Possible suitors for the Ukrtelecom stake include domestic billionaire Rinat Akhmetov’s conglomerate System Capital Management, Russian groups Sistema and Alfa, Turkey’s Turkcell, Hungary’s Magyar Telekom and Telekom Austria. Norwegian group Telenor, majority owner of Ukraine’s mobile market leader Kyivstar, said earlier this week that it was unlikely to bid for the Ukrainian national PTO, which recently relaunched itself in the mobile market as the country’s monopoly 3G operator. Ukrtelecom is 92.778% state-owned. 5% of shares are owned by management, and 2.14% by employees. A 0.07% stake is listed on the local stock exchange.

Ukraine, Ukrtelecom (incl. TriMob)