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Kosovo to try again to sell its telecom firm by end of 2019

Thursday, Jan 31, 2019

Kosovo will offer its loss-making state-owned telecom company to private investors by the end of the year, the country’s economy minister said on Wednesday, its third attempt to sell a stake in the company in the past decade.

In 2013 the government cancelled an already agreed sale to Germany’s ACP Axos Capital Gmbh and U.S.-based investor Najafi after failing to secure parliament backing for the 277 million euro deal.

“In the first half of the year we will work to restructure (the company) and by the end of 2019, the process of tendering will be open,” Economy Minister Valdrin Lluka told Reuters.

Lluka said the process may last three or four months.

“In March or April next year the best bidder is expected to be announced,” he said.

The European Bank for Reconstruction and Development (EBRD) will offer technical assistance to prepare the sale.

Lluka said France’s Orange, Rockaway fund, Telekom Austria and others, have expressed an interest in participating in the bidding process.

“The situation at the telecom is bad now. It is overstaffed with 2,500 employees and last year it posted a 14 million euro loss,” he said.

Lluka said revenue dropped to 72 million euros last year from 145 million euros in 2011.

The average wage at PTK is about 1,000 euros per month, compared with around 420 euros a month for other public sector workers such as doctors and teachers.

Once the most profitable company in the country, PTK has been in red since 2015 due to inefficiencies and rising competition from the second mobile operator IPKO, owned by Telekom Slovenije.

Company debt amounts to 60 million euros.

Lluka said that his government is also planning to offer foreign investors some state-owned companies and land through a new law on strategic investment which aims to cut bureaucracy.

He said this may include some 11 lead, zinc, nickel and chrome mines, energy projects in wind and solar, a ski resort and the giant mining complex Trepca.

Corruption and political instability have kept many foreign investors away from Kosovo since the country of 2 million people declared independence from Serbia in 2008.

 

Source: uk.reuters.com

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