Ukraine targets $1.5b from telco sale

Strict auction rules have all-but excluded western operators from bidding for Ukrainian state telco Urktelecom.
 
A tender to buy the government’s near 93% stake in the fixed-line telco was opened yesterday, but rules stipulating that companies bidding for the stake must not be more than 25% owned by their domestic states will exclude major players including Deutsche Telekom and Telenor, FT.com reported.
 
Companies with more than a 25% stake in Ukrainian telecoms firms will also be barred from the auction, the newspaper said.
 
Analysts say the restrictions could limit the number of firms bidding for Urktelecom, despite the fact Ukraine’s government is desperate for the cash after being bailed out by the International Monetary Fund.
 
Regardless, the government hopes to raise $1.5 billion (€1 billion) from the sale, which is due to close late December.
 
Russian long-distance operator OAO Rostelecom, System Capital Management, and AFK Sistema are tipped as likely bidders.
 
Ukraine’s government has long sought to offload Urktelecom, which includes a small domestic mobile business, but was prevented by internal disagreements, Bloomberg reported.

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