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State presses OTE for RomTelecom deal as deadline nears; telco may merge with Cosmote if shares listed

22 Feb 2011

Romanian communications minister Valerian Vreme has stepped up the pressure on Greek telecoms company OTE to formulate a buyout offer for the government’s 45.99% stake in fixed line incumbent RomTelecom as the three-month extension date for the sale fast approaches. It is believed that the EUR1 billion (USD1.37 billion) price tag demanded by Bucharest in November 2010 continues to prove problematic for majority shareholder OTE, which owns the remaining 54.01% of the telco. If OTE proves unwilling to meet the government’s asking price, Vreme reiterated the government’s intention to list its stake on the local bourse instead.

In related news, Vreme has mooted the possibility of merging RomTelecom with the government’s other telecoms asset, cellular operator Cosmote Romania, before listing any state-owned shares. According to TeleGeography’s GlobalComms Database, Cosmote Romania is owned by the Greek telco OTE (70%), with the remaining 30% held by RomTelecom. According to news agency Mediafax, Vreme has already met with representatives of several investment banks, including Citibank, Goldman Sachs and Rothschild, in preparation for the possible stock market listing.

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