ETB needs COP1bn to avoid privatisation: loansharks need not apply

8 Jul 2011

Bogota’s new Treasury Secretary, Hector Zembrano announced yesterday that Empresa de Telecomunicaciones de Bogota needs a capital injection of COP1 billion (USD565,000) over the next three years to avoid privatisation. Although previously in favour of selling the company, Zembrano now believes that seeking a loan would be a possible alternative to privatisation. The telco has been attempting to raise capital for expansion and development but has been unsuccessful. ETB may seek out alliances with other companies, but remains tight-lipped regarding its possible search for a strategic partner.

As previously reported by TeleGeography’s CommsUpdate, in 2008 ETB sought a strategic partner with its principal owner, Bogota’s district council, offering a 49.9% stake in the company, later lowering the amount to 36.6%. A raft of potential investors declared their interest, including the UK’s BT Group, CANTV of Venezuela, Brasil Telecom (BrT), Millicom International Cellular, local telcos Telefonica Telecom (part of Spain’s Telefonica Group) and Telmex Colombia. In July 2010 Telefonica was given a green-light to buy up the shares by Colombia’s anti-trust authority but declined to enter a bid. When it was revealed that there were no other pre-qualified bidders for the stake the company’s shares went into a tailspin. In June 2011 the Bogota district council announced that it was reconsidering the sale of its 86.6% stake in the telco, and will reach a decision later this month.

Colombia, Empresa de Telecomunicaciones de Bogota (ETB)