Government gives go-ahead to Slovak Telekom stake sale

13 Feb 2015

Under a decision adopted by the cabinet at its session of 11 February 2015, the government will submit the documents concerning the sale of the state’s 49% stake in Slovak Telekom (ST) to parliament by 6 March, the Slovak Spectator reports. The Economy Ministry proposes to sell the shares in a ‘dual track’ strategy, i.e. either via its preferred initial public offering (IPO) on capital markets or via a direct stake sale offer. ‘The final decision, which of the two forms of sale will be picked, will depend on market conditions and recommendations of investment banks as advisors in this process in order to achieve the most advantageous sale conditions,’ the cabinet documentation reads, as quoted by the TASR agency, while the shares are likely to be sold at two stock exchanges, Bratislava and London.

In February 2014 state officials and ST’s majority owner Deutsche Telekom signed a memorandum on cooperation in the stake divestment. Afterwards the National Property Fund (FNM) privatisation agency began the process of choosing an investment bank, which will be tasked with the general coordination and management of the IPO project, among other things. In April 2014 the cabinet approved an amendment to the privatisation act extending the means for the sale of state assets to include the stock exchange, which was adopted by parliament in June.

Economy Minister Pavol Pavlis stated that the project is expected to be approved by parliament within a month. In further comments quoted by the Xinhua news agency, the minister added: ‘Preferentially we’ll push it through the capital market in order to generate the best price. It should be as transparent as possible, with the highest profit possible. Advisors, which will be renowned banks working for the FNM, will issue recommendations for us. I believe that we may conclude this process soon … The state wants to conclude the entire process by the summer of this year.’

Slovakia, Deutsche Telekom (DT), Slovak Telekom (ST, incl. T-Mobile, DIGI)