Friday, March 23, 2007

Government Sells Minority Share In ArmenTel

22 march 2007
By Emil Danielyan

Ending months of speculation, the Armenian government announced on Thursday the sale of its minority stake in ArmenTel to a Russian company that acquired 90 percent of the national telecommunications operator late last year.

The government said VimpelCom, a leading Russian mobile phone operator, will pay approximately $50 million to get the remaining 10 percent of ArmenTel's stock. A government statement issued after a weekly cabinet session did not give reasons for the move. It only cited a November 13 memorandum of understanding signed by VimpelCom and the Armenian Ministry of Transport and Communications.

VimpelCom, the first Russian firm listed on the New York Stock Exchange, purchased the commanding share in one of Armenia’s largest companies from the Greek telecom giant OTE in a $500 million deal announced on November 3.

Media reports at the time said the government offered the Russians to buy its largely symbolic share on the condition that they will give up ArmenTel’s controversial legal monopoly on Armenia’s Internet communication with the outside world. Armenian officials and VimpelCom executives did not confirm those reports.

On December 18, VimpelCom unilaterally relinquished the Internet monopoly and pledged to scrap ArmenTel’s remaining exclusive rights to other telecom services by the end of this year. The move was strongly welcomed by local Internet service providers and their customers that have long complained about the poor quality and high cost of the service.

Note: Above are excerpts from the article. The full article appears here. Clarifications and comments by me are contained in {}. Deletions are marked by [...]. The bold emphasis is mine.



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