Monday, July 18, 2005

Government open to Lattelekom, LMT privatization

Latvian prime minister Aigars Kalvitis says he has received a proposal from TeliaSonera to privatize the remaining government shares in fixed network operator Lattelekom and Latvian Mobile Telephone (LMT) and will present it to Tuesday's meeting of the Cabinet of Ministers, the news agency LETA reports.
The government current owns 51 % of Lattelekom and 28 % of LMT (23 % is owned by Lattelekom, 49 % by TeliaSonera).
Kalvitis says he will propose forming a working group to negotiate the possible terms of the sale. TeliaSonera, otherwise known as Lattelekom's half-mother, has been saying for a couple of years that it would like to take 100 % of both operators.
This is a turnaround from the policy of the previous government of Indulis Emsis, who put the issue of privatization on ice. Kalvitis' statement can be seen as a breakthrough. It is know that earlier, as Minister of Economics in a previous government, Kalvitis was open to doing some kind of deal with TeliaSonera to settle the then-ongoing arbitration dispute.
More on this later and tommorrow.

5 comments:

This time - a reader said...

Well, the things are a bit different, though.
All this "daughtering" is still about other things, not just about beeing effective, it is still a good and legitimate way to split and share "the cashcow" without sharing it with the state. Rethorically, you may ask- why, but those, with post-soviet experience do not ask why's....:).

Anyhow, I am sure, that famous "digitialization plans", who should lead to internet and phone acess in rural areas will be forgot, and all we will get, is a new logo and brand new marketing plans, but no other developements, since, there is no ambition and obligation to do that anymore.

Some quite recent reseach done by one market intelligence company I will not mention, shown that Telia-Sonera might be sold to some other company as well, so.... expect the unexpected.

Juris Kaža said...

Thanks, reader.
Lattelekom has committed itself to finish digitalization for LVL 30 million. What is left is the hardest and most expensive 10 % or so, literally places where it is cheaper to buy customers an apartment in the nearest town that to run a modern line out to them for LV 10 000. Lattelekom is looking to use cdma 450 technology instead and install fixed wireless phones and wireless internet.
As for TeliaSonera being the object of a possible takeover, this has been discussed on this blog a couple of times.

This time - a reader said...

Well, they have commited that for....how long time...?
I have been quite into this and I have no any illusions regarding these promises and fullfilling them :). Anyway, that is not the main issue. The main issue is policy making: to sell LTK for few bucks urgently, in summer, while there is no politically big attention to this- it looks like some known signature.

Of course, the aim of the state is not to provide telecomunications, but, anyhow, I can just greet Tilts& TeliaSonera and some other guys :)) They will get it almost for free.

Anonymous said...

If this is fair play without an idiot or frog ahead, the process of calculating real value of Lattelekom/LMT can't be quick process.
For example- only in october/ november goverment institutes will aprove the deal for Microlink. Only then State could get full access to figures of whole concern. Of course, some kind of info alreaday should have representatives of biggest share holder - State.

Khe, khe said...

People who know know, people who do not know will never know ...