Slovakia’s government has decided to begin negotiations on the potential sale of its 49% stake in Slovak Telekom (ST), majority owned by Germany’s Deutsche Telekom (DT), which holds the right of first refusal on the shares. The much-delayed privatisation of the state’s holding in ST has been proposed to raise funds for a government buyout of two private health insurance companies, notes financial newspaper Hospodarske Noviny, a plan for which has been drawn up by the Ministry of Economy for discussion by the government. The plan is aimed at bringing the country closer to creating a single national health insurance system in 2014.
TeleGeography’s GlobalComms Database says that the Ministry of Economy owns 34% and the National Property Fund (NPF) a 15% slice of ST, while DT holds first refusal rights on the combined 49% stake, and is also required to give permission for an initial public offering (IPO); the German firm has said it will consider taking its ownership in ST to 100% if it makes economic sense. The market value of the state’s share has been estimated at roughly equal to ST’s consolidated revenues, which slumped by 6.7% to EUR837.4 million (USD1.089 billion) in 2012. Former Minister of Economy Juraj Miskov (who left the post in 2012) claimed that the state’s 49% in ST was worth ‘more than EUR1 billion’, a figure well above estimates made in the course of the sale of 51% to DT in 2000, mainly because the company now includes the merged mobile operator formerly known as T-Mobile Slovensko which was completed in July 2010. Previous government proposals for total privatisation of ST have favoured an IPO as a means of getting the highest possible returns from the sale.