New OTE strategy and orientation
After a three-year focus, primarily on its domestic activities, the Hellenic Telecommunications Organization (OTE) is now set to review its policy for international expansion. This was confirmed by OTE President Panagis Vourloumis in statements made during the recent Thessaloniki International Fair. He acknowledged that OTE is now eyeing Telecom Slovenia (Telekom Slovenje) which is soon to be up for privatization. Nevertheless, he said that because of the high price, it was unlikely that OTE would take part in a bid. The Slovenian government is to sell a 49 percent stake in the firm, whose value is estimated at -3.1 billion, an amount equaling its capitalization on the Ljubljana stock exchange. The Slovenian state currently holds a stake of 62.5 percent, while the company’s management would fall into the hands of the strategic investor as majority shareholder. Telecom Slovenia provides services in both fixed-line and mobile telephony and owns a number of subsidiaries in Kosovo and the Former Yugoslav Republic of Macedonia (FYROM). OTE is still monitoring developments on a technical level, according to sources, and decisions, of course, could not be taken before today’s national election. The deadline for expressions of interest in the tender for Telecom Slovenia expires on September 28. So far, 11 companies have expressed interest in buying the firm, the Slovenian government said. Given the rather small number of its customers, approximately 2 million, OTE believes that the Slovenian telecom firm is pricey. Telecom Slovenia’s turnover stands at -750 million on an annual basis, with net profits at around -100 million. Irrespective of the bid’s outcome, it is the first time in the past four years that OTE is considering a takeover beyond Greek borders. Until recently, the sole reference with regard to OTE’s acquisitions was that of Telecom Serbia, which is still pending. But fresh buyouts are also being eyed by OTE subsidiary Cosmote, a mobile telephony provider. Managing Director Evangelos Martigopoulos recently said that until 2009 the company would return capital to its shareholders, unless there was some takeover on the horizon. Even though Cosmote has heavy debts of approximately -3 billion, primarily due to its takeover of Germanos, the company is open to its likely expansion into new geographical markets. The firm’s management is even willing to get its hands on markets beyond the close borders of Southeastern Europe, provided the specific moves are rational and realistic. To this end, the group seems to have got used to the idea of building on a move by businessman Panos Germanos into Poland. Germanos controls a stake in the country’s fourth-largest mobile phone company, which is majority controlled by investment firm Novator, known in Greece for its holding in Forthnet.
