The Greek government has confirmed it will sell 10 per cent of its remaining shareholding in OTE valued at €411 million by activating a put option agreed to with Deutsche Telekom (DT).
The German telco said that, as of Thursday, it had not received paperwork from the Greek government with regard to this put option, which was agreed in 2008 when DT first acquired a 30 per cent holding in OTE.
DT CEO Rene Obermann confirmed that, if the Greek government exercised the option, his company would meet the terms of the contract. However, this deal is something that Obermann would probably prefer not to conduct given OTE's admission that its first-quarter net profit fell a worse-than-expected 54 per cent on poor sales and a special charge related to planned staff cuts. OTE also has operations in Romania and Bulgaria, where it has warned of a difficult business climate.
But the deal looks certain to proceed following a meeting last week between the Greek finance minister, George Papaconstantinou, and DT executives. While the discussions focused on the sale of the 10 per cent holding in OTE, the Greek government has suggested that it will shortly open negotiations with DT over the remaining 6 per cent it holds in OTE.
The put option that DT agreed to in 2008 only mentions the German operator taking a further 10 per cent of OTE's shares, and having already spent €3.8 billion acquiring its initial 30 per cent, DT might wish to consider its options before agreeing to acquire the remaining 6 per cent of OTE held by the Greek government.
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