OTE amendment to be clarified

The government is preparing a number of changes to the amendment it tabled in Parliament last Friday to control large holdings in companies of strategic interest. Economy Ministry sources note that the changes will mean that a 20 percent stake in strategic companies will require government approval by the interministerial privatization committee, and only stakes of up to 19.99 percent will not require government approval. The same sources noted yesterday that «this is not a modification of the original amendment but a clarification of its clauses.» OTE President and Chief Executive Panagis Vourloumis commented yesterday that the change does not alter the company’s value, adding however that the latter is affected by the efficiency of its management. In a letter to shareholders he explains the content of the amendment and says there may be changes to it. «The government has tabled an amendment in Parliament which sets conditions and criteria relating to the acquisition by third parties of voting rights in excess of 20 percent of shares in corporations of strategic importance and national interest that in the past have been state monopolies. OTE belongs to that category, too,» writes Vourloumis. «We believe that this development will in no way affect the value of the corporation which depends, as in the past, on the effectiveness of its administration and the implementation of the company’s business plan,» he adds. However, the small Liberal Alliance party yesterday had recourse to the European Commission over the amendment. In a letter sent to Competition Commissioner Charles McCreevy, the party argues that «this specific ban is legally lame,» charging that it constitutes «a Soviet-type intervention» in the economy. Meanwhile, an event organized yesterday by the Hellenic Telecommunications and Post Committee (EETT) on quality in telecom services turned out to be stormy. Transport and Communications Minister Costis Hatzidakis and EETT President Nikos Alexandridis were surrounded by OTE unionists who demanded «regulation of the regulators,» shouting, «Hands off OTE.» The unionists accused EETT of «torpedoing» OTE and called for a meeting with the minister, who in the past had refused to meet them. They told Hatzidakis that the sale of OTE subsidiary Infote constitutes a sell-off of OTE property. Hatzidakis promised them a private hearing. Separately, Fitch Ratings yesterday affirmed OTE’s Long-term Issuer Default rating (IDR) at BBB with Stable Outlook. At the same time, the agency has affirmed OTE’s senior unsecured rating at BBB.