ECONOMY

OTE closer to Cosmote buy

Greece’s sale last week of a stake in the country’s largest telephone company, OTE, leaves the group free to buy out minorities of its Cosmote mobile phone unit, OTE’s chief executive said yesterday. «I believe the merger with Cosmote is the solution for the future of the group,» Panagis Vourloumis told reporters. «Combining (the two companies) into one stock may be a solution, but I won’t say anything about the possible timing.» Greece last week reduced its 39 percent holding in OTE. It sold 10.7 percent after failing to find a strategic partner. The move makes it easier for OTE to plan for the future, including buying out subsidiary Cosmote. «The sale clears overhang concerns. It is one less factor that we have to concern ourselves with,» Vourloumis said. OTE currently holds about 67 percent in its mobile unit Cosmote and has said it was considering raising its stake to 100 percent to offset falling fixed-line revenues from increased competition. OTE expects to lose more than 170,000 clients by the end of the year as Greece deregulates its telecoms market and smaller competitors such as Internet provider Forthnet and mobile giant Vodafone enter the fixed-line market. «Client loss will probably be slightly higher, but there shouldn’t be any dramatic changes,» Vourloumis said. OTE will also complete the sale of its Infote unit by the end of the year, helping raise cash to proceed with further expansion plans, Vourloumis said. «Parties are expected to express their interest in the purchase of Infote in the next few weeks. We expect the entire process to be completed by the end of the year,» he said. (Reuters)