ECONOMY

Globul to get EBRD loan

SOFIA (Reuters) – The European Bank for Reconstruction and Development (EBRD) said yesterday it planned to provide 90 million euros to the Bulgarian unit of OTE Telecom to help its expansion. John Chomel-Doe, the bank’s country director for Bulgaria, said with the deal, expected to be sealed by the end of the year or in early 2003, the EBRD would acquire about 5 percent of Bulgaria’s second-biggest digital mobile operator. The board of EBRD, set up to assist Eastern and Central European countries in the transition to market economy, has already approved the funding for OTE’s fully owned unit, Globul. «The planned funding is for 90 million euros (approx. $90 million), of which 80 million euros is in the form of debt and 10 million euros for equity,» Chomel-Doe told reporters. Globul has grown rapidly since its launch in September 2001 with subscriber numbers now nearing 400,000. Its network covers 80 percent of Bulgaria’s population of some 8 million, a Globul spokesperson said. It won a 15-year license to operate Bulgaria’s second GSM network in late 2000 for $135 million. OTE has invested 600 million levs ($307 million) in Globul as of September, including the license, and has earmarked a further 100 million levs for investment by the end of this year. Investment plans for 2003 total 150 million levs, it has said. Globul competes against Mobiltel, owned by an Austrian consortium, whose subscriber numbers have topped 1.6 million, and small analog operator Mobikom, in which Britain’s Cable & Wireless holds a 49 percent stake. Parent company OTE plans to cut more than 3,500 jobs by 2005 as it tries to keep a tighter grip on costs, Deutsche Bank said in a report dated December 3. Deutsche Bank said management told analysts at a London presentation that OTE was planning to cut another 600 jobs from its parent company in 2003 and an additional 3,500 by the end of 2005. OTE, still a third owned by the Greek State, has been trying to whittle down operating costs to offset the loss of its fixed-line monopoly in 2001 but has been hampered from expanding its voluntary retirement scheme by its status as a former state-owned utility. OTE said last week its work force numbered 17,969 at the end of September, 4.9 percent lower than at the same time in 2001.