BTC sale held up by political considerations

SOFIA – Bulgaria’s privatization agency is under political pressure to reject US private equity house Advent’s 230-million-euro deal to buy telecoms operator BTC, despite a court decision naming Advent as the winner, sources close to the sale said yesterday. One source said the agency had been pressured to sign a deal with the only other bidder, a Turkish consortium led by Koc Holding. Local media and commentators have been speculating that the government wants to sell the outdated BTC to the Turkish bidder to please its junior coalition partner, the ethnic Turkish MRF party, on which it depends for its slim parliamentary majority. «The agency is not finalizing a deal with Advent because politicians want a deal with Koc. But there is no way to do it because there is an explicit supreme court decision saying that Advent is the legitimate buyer,» the source said. «There is pressure on the agency to try and reject Advent, but whoever dares to do that risks going to jail. The only outcome of this limbo is for politicians to stop messing around,» the source said. The Privatization Agency, which is handling the sale, declined any comment on BTC and has so far failed to say how it plans to proceed with the sale. Transport and Telecoms Minister Nikolai Vassilev also declined comment on the troubled sale but said if it was not completed the government would relaunch the BTC privatization. Last week the Supreme Administrative Court issued a final ruling that Advent’s 230-million-euro ($269 million) deal for 65 percent of BTC was approved by default by the agency’s supervisory board in mid-August. A deadline expired on August 15 for the board to decide whether to approve the deal, but it said at the time that it was unable to make a decision due to incomplete documentation. Another source close to the sale said the agency would not be able to find any legitimate grounds to reject Advent but would instead try to delay a decision as long as possible. Vassilev said if a new sell-off procedure for BTC was launched, the government would first partly restructure the outdated operator to ensure funds for its modernization. BTC needs hefty investment to upgrade its analog network after it lost its landline monopoly early this year.

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