OTE sale deal clinched

Gov’t to share ownership, management of incumbent with D. Telekom

The government agreed yesterday to sell part of its stake in OTE telecom to Deutsche Telekom and will share management of the former state monopoly in one of the largest foreign investments to take place in Greece in recent years.

Finance Minister Giorgos Alogoskoufis said the Greek state and Deutsche Telekom would each control 25 percent plus one share of OTE while the German company could raise its holding.

“The agreement with one of the largest and most reliable telecoms organizations in Europe and the world, opens a new chapter not only for OTE but for the whole of the Greek economy,” he said.

The German group agreed to pay 29.75 euros for each OTE share, about 45 percent above current prices, for 3 percent of the government’s holding in the company.

The minister said each side would control five seats on OTE’s 10-member board.

In March, Deutsche Telekom had agreed to buy a 20 percent stake in OTE from Marfin Investment Group.

Greece has been struggling to attract foreign investors since French lender Credit Agricole bought a majority stake in Emporiki Bank back in 2006. The OTE deal will also earn the government 442 million euros which will go toward paying off the country’s large public debt.

The sale will only come into effect after it is approved by Parliament, where the conservatives have a slim one-seat majority in the 300-member house.

The agreement has faced strong opposition from labor unions and opposition parties.

“The government’s sell-off of OTE to Deutsche Telekom, despite opposition from the majority of society, is like putting up a ‘for sale’ sign on the future of the country,” said Dimitris Stratoulis of Synaspismos Left Coalition.

Meanwhile, PASOK said it will exhaust all of its legal means to regain control of OTE from the German operator if it returns to power at the next elections.

PASOK leader George Papandreou said he objected to the deal because Greece should not be handing over control of companies that are of “strategic importance” as they should operate “for the benefit of citizens and consumers.”

OTE employees have called a 24-hour strike for today.