Telecom defines bidding terms

According to BNamericas the Colombian government has made public the terms of its much anticipated auction of state-owned telco Colombia Telecomunicaciones (Colombia Telecom). According to the statement, the winning bidder will receive 50% plus one share of Telecom’s equity, plus 7% of the company’s EBITDA until 2010 and 3% from 2011 onwards. The winner will be required to pay off Telecom’s pension debt of COP7.58 trillion (USD3.37 billion) in 17 annual installments. Interested parties must pay COP160 million (USD71,000) for the bidding rules, as well as COP40 million for access to the company’s dataroom. Seven companies are reported to have already paid the fees in question: ETB, EPM, Telefonica, CANTV, PhoneOne, Cablecentro and Ortiz Rey. The government is expected to announce the minimum bid in the third week of March, with speculation suggesting that it is expecting a figure in excess of USD350 million.