December 9, 2013 / 9:41 AM / 4 years ago

Privatisations in focus during Austria coalition talks

VIENNA, Dec 9 (Reuters) - Austrian conservatives are pushing to sell more state-owned shares in big Austrian companies such as OMV, Telekom Austria or Austrian Post as coalition talks heat up with the Social Democrats.

The two big parties that have dominated post-war politics have laboured to strike a deal that could keep them governing together after September elections that weakened them both and bolstered the eurosceptic right wing.

Differences over how much belt-tightening Austria needs to shore up state finances and pensions have held up a deal.

But talks gained pace after marathon weekend wrangling, keeping alive the centre-left Social Democrats’ (SPO) goal to have a government in place by Christmas holidays on Dec. 24/25.

“It is right to say we’re near the finish line, but it is not so easy to say how long it will still take,” one SPO source said on Monday.

The People’s Party (OVP), junior partner in the coalition that has governed since 2006, wants to cut state stakes in OMV, Telekom and Post to a blocking minority of 25 percent plus one share, party heavyweight Erwin Proell, governor of Lower Austria province, said in weekend media interviews.

Austrian media gave a mixed picture of how likely it was for the OVP’s wish to come true, given entrenched opposition to further privatisation among many SPO leaders and labour unions.

“I‘m not so sure there is as much movement as some newspapers say,” the SPO source said, noting such sales would give state coffers just a short-term boost while reducing the dividend flow from companies.

Austria has a 31.5 percent stake in energy group OMV and reducing it could be complicated by an agreement with Abu Dhabi’s state investment fund IPIC - which has 24.9 percent - to coordinate any changes in holdings.

Austria owns 28.4 percent of Telekom Austria via the OIAG state holding company. It may need to stump up more money if it wants to keep that stake steady, should the company raise capital, a step that major shareholder Carlos Slim’s America Movil has called “very likely”.

Austria owns a 52.9 percent stake in Post. (Reporting by Michael Shields; Editing by David Holmes)

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