Telekom Austria misses out in Serbia

Serbia’s government has taken Telekom Srbija off the market after failing to persuade Telekom Austria to pay €1.4 billion for a controlling stake. 

The government rejected an offer of €1.1 billion for 51% of its national telco, despite picking Telekom Austria as its preferred bidder and giving the operator extra time to revise its initial €800 million to €950 million offer.
Telekom Austria claims the €1.4 billion price tag is unrealistic, and that its revised offer would have generated long-term value for shareholders of both companies.
“Telekom Austria…is convinced that the current offer is attractive and reflects the market conditions in a fair way. It would have allowed the Government of Serbia to enter into a sustainable long term partnership,” a company statement revealed. 

The firm will turn attention to growing its current Vip mobile business in Serbia, which it estimates held 14% of the market at end 2010, and is generating steady growth in mobile revenues.