Talks on Lattelekom deal entering crucial phase

  • 2003-12-18
  • From wire reports
RIGA - This week the Latvian government was preparing what it called was its final compromise offer to TeliaSonera in the arbitration case on Lattelekom.

Viesturs Sutko, an adviser to the prime minister and a member of the working group for negotiations with TeliaSonera, said that the government was likely to respond to TeliaSonera's offer before Christmas.
However, he stressed that the government for now would not address the question of selling either the state's 51 percent stake in Lattelekom or its 28 percent stake in Latvia's Mobile Telephone, an issue of vital importance to strategic investors.
The Finnish-Swedish telecommunications giant said earlier that its objective was to build up majority holdings in Lattelekom and Latvia's Mobile Telephone.
At present TeliaSonera owns 49 percent of LMT. Through its 49 percent holding in Lattelekom - nominally owned by Tilts Communications - it also owns another 23 percent of LMT.
According to unofficial information, TeliaSonera may have offered to buy the state-owned 51 percent of Lattelekom shares for 2 billion - 3 billion Swedish kronor (153 million - 230 million euros).
TeliaSonera inherited from its merger with Sonera the claim of 80 million lats (121 million euros) against the Latvian state for reducing Lattelekom's monopoly by 10 years from 2013 to 2003.
The government of Latvia submitted a counterclaim of 600 million lats for breach of so-called framework contracts and failure to modernize networks as rapidly as agreed.
Vice President of TeliaSonera Kenneth Karlberg said that if TeliaSonera owned a majority stake in the fixed-line telecommunications operator, it would be easier to offer a united set of services and to develop new services for Latvian clientele.
Meanwhile, in Lithuania TeliaSonera was allowed by the competition council to acquire up to a 90 percent stake in Omnitel, the mobile phone operator, Verslo Zinios reported.
Pursuant to the decision, TeliaSonera may now purchase an extra 35 percent stake in Omnitel via its subsidiary Amber Mobile Teleholding under the condition that Omnitel cannot be reorganized by merging it with the fixed-mobile operator Lietuvos Telekomas or any other economic entity which is directly or indirectly controlled by TeliaSonera without prior notice to and permission of the competition council.