Telekom mulls cancellation of own shares

13 Mar 2014

State-backed fixed line incumbent Telekom Srbija may cancel all or a portion of its own shares by the end of the year, Novosti quotes the telco’s general director, Predrag Culibrk, as saying. The telco currently holds 20% of its own shares but is required to reduce that stake to a maximum of 10% by 1 January 2015. Sceptical of its chances to find a buyer willing to pay the EUR380 million (USD527.2 million) value for the shares, which carry no management rights, Telekom is considering cancelling the shares, thereby increasing the stakes of existing shareholders. The operator is currently owned by the Serbian government (58.11%), Serbian citizens (14.95%), current and former employees of Telekom Srbija (6.94%), whilst Telekom Srbija itself holds the remaining 20%. The cancellation of Telekom’s own shares would increase the stake of the government in the operator to around 72%, although Telekom’s capital would be reduced as a result. Should Telekom opt to sell the shares, it must first offer them to existing shareholders, including some five million Serbian citizens after each citizen was handed 31 free shares in the company in May 2012, following the buyout of former stakeholder, Greece’s OTE, in January that year.

Serbia, Telekom Srbija (MTS)