Sweden's Telia ready to give up control of merged telecom: minister

The Swedish telecommunications group Telia, the private shareholder in the Latvian telecommunication companies Lattelecom and Latvijas Mobilais Telefons (LMT), has notified the Latvian Economics Ministry that it would agree to the Latvian state obtaining a controlling stake in any new company created as a result of a merger between Lattelecom and LMT, Economics Minister Arvils Aseradens (Unity) told TV3 commercial television October 9.

The minister said that Telia's new position would significantly change the situation when the Latvian government had to decide whether to agree to the proposed merger, the LETA newswire reported.

Previously Telia was insisting that it should get the controlling stake in the combined company.

Moreover, the new offer of the private shareholder will not require additional expenditure from the Latvian national budget for the government to get the controlling stake, Aseradens said.

Now the government would need time to consider the new offer. Aseradens would not say whether he would urge the fellow ministers to accept the offer from Telia, nor the value of any transaction linked to the deal.

As reported, the Scandinavian telecommunications group TeliaSonera, which also holds shares in Lattelecom and LMT, proposed on November 20, 2015 that both companies should be merged. However, the Latvian government decided in April 2016 that LMT and Lattelecom would continue operations as two separate entities.

The government also decided to hire an independent consultant to perform macroeconomic, microeconomic and socioeconomic analysis of further actions concerning state-owned shares in Lattelecom and LMT. KMPG Baltics was then selected to help the government develop a strategy on state-owned shares in Lattelecom and LMT.

The KPMG audit company has analyzed further actions concerning the state-owned shares in Lattelecom and LMT and suggested that the two companies should be merged.

According to Firmas.lv business information website, the Netherlands-registered Sonera Holding B.V. owns 24.5 percent of LMT shares, Telia Company AB - 24.5 percent, Lattelecom - 23 percent, state-owned company Latvijas Radio un Televizijas Centrs - 23 percent, and the Latvian Privatization Agency - 5 percent.

At the same time, 51 percent of Lattelecom shares belong to the Privatization Agency and the other 49 percent to TeliaSonera's Danish subsidiary, Tilts Communications.

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