ECONOMY

Stet Hellas plans lawsuit against State

Mobile phone company Stet Hellas is planning to sue the Greek government in the administrative appeals court for 39.9 million euros (136 billion drachmas) for terminating an eight-year exclusivity contract it had signed with the State when it acquired its second-generation mobile phone license in 1993, the online site of Flash radio reported yesterday. It said that Stet Hellas claimed to have suffered losses following the awarding of a second-generation mobile phone license to CosmOTE, a subsidiary of state-controlled telecoms operator OTE. Stet Hellas is asking for 39.9 million euros, a sum it believes is commensurate with profits lost from the entry of CosmOTE into the sector during the period February 1998 to September 2001, namely from when the OTE subsidiary commenced operations to the expiry of Stet Hellas’s exclusivity contract last year. Analysts have said that CosmOTE’s debut in the mobile telephony industry affected Stet Hellas more than Panafon-Vodafone. Stet Hellas has since then lagged behind and it currently is the third-ranking operator. Panafon-Vodafone filed a similar suit with the administrative appeals court in December 2000, asking for compensation of 94 billion drachmas. The case has yet to be heard. The European Court recently ruled against the Greek State in a case brought by Panafon-Vodafone, saying that its decision to cede a third mobile phone license to OTE without conducting a tender for expressions of interest was without precedent. These bonds, with either a fixed or floating interest rate, were attractive because of their much higher yields compared to other European bonds. Now that the time has come to pay the principal on some of the bonds, with payments expected to exceed 15 trillion drachmas in the period 2002-2004, the government is looking at ways to refinance its debt