OTE telecom has canceled plans to list its real estate investment company on the Athens bourse by October, citing poor market conditions in the recession-hit country.
OTE, which is 30 percent-owned by Deutsche Telekom, said on Wednesday that a listing of its real estate investment company (REIC) on the Athens stock exchange would not be ‘an optimal move’ from a strategic point of view.
?The current economic and financial environment, characterized by lack of liquidity and oversupply of commercial real estate, is not favorable for the development of real estate companies,? OTE said in a statement.
OTE had obtained permission from Greece?s Capital Market Commission in June 2008 to list the REIC by October 2011.
The Greek telecom company added that it will now proceed with the dissolution and liquidation of OTE Properties REIC.
Prior to the recession starting in Greece in 2009, OTE had estimated its property portfolio to be worth about 1.8 billion euros. Ninety percent of the properties are used by OTE, with the remaining 10 percent leased out to other parties.
Brokers welcomed the move, saying that ?it makes no sense to list a REIC at a time when they are trading at a steep discount and liquidity conditions in the market remain tight.?
?Besides, I don?t think that Deutsche Telekom was ever in favor of listing the property assets,? said a broker from a leading Athens brokerage.
The decision is not seen as having an impact on OTE?s financials, brokers added.