OTE’s USD1.5 billion stake sale goes ahead

The domestic stock market placement of 10.7% of state-held shares in Greek incumbent telco OTE began this morning, with the government aiming to raise up to EUR1.1 billion (USD1.5 billion) to help pay down debt. 52.45 million shares went on sale at a price range of EUR20.8-EUR21.4 (USD28-USD28.8) per share. No timeline for closing the order book was given, but it is likely that all offers will be received by the end of today. The government currently owns 38.7% of the telco. Earlier this year it failed in its bid to divest a stake in OTE to a European strategic telecoms investor, partly due to its reluctance to relinquish management control. The state plans to raise EUR1.7 billion from selling stakes in OTE and other companies this year. Greece’s debt fell to 104.6% of GDP in 2006 from 107.5% in 2005, although this is the second highest debt-to-GDP ratio in the European Union, after Italy. Today’s sale also clears the way for OTE to launch an offer for the 33% of its mobile division Cosmote that it does not own; the proposed move had been delayed pending the further privatisation of OTE.