February 15, 2014 / 7:10 PM / in 3 years

Deutsche Telekom, Greece close to OTE stake deal: report

2 Min Read

The logo of Deutsche Telekom is pictured on the 266 metre high "Colonia" TV tower in the western German city of Cologne March 25, 2013.Wolfgang Rattay

ATHENS (Reuters) - Germany's Deutsche Telekom (DTEGn.DE) is close to a deal to increase its controlling 40 percent stake in Greece's OTE (OTEr.AT) by buying a further 10 percent from the debt-laden government, the newspaper To Vima reported.

The two sides are "in advanced talks" and "ready to shake hands", the report said on Saturday, without citing sources.

A Finance Ministry official declined to comment on the report, as did a spokesperson for Deutsche Telekom.

The Greek newspaper Kathimerini first reported last month that Deutsche Telekom was eyeing the 10 percent stake.

OTE is worth 6.1 billion euros on the Athens Stock Exchange, giving the stake a market value of about 610 million euros. Greece directly owns 6 percent of the stake, and the remaining 4 percent are owned by the state-run pension fund IKA.

When Deutsche Telekom bought its existing stake in 2008, it secured a right of first refusal if the state decided to sell any more shares. The remaining 50 percent are held by smaller private shareholders.

Greece is pursuing a multi-billion euro privatization program under the terms of its international bailout.

Selling the OTE stake has not been part of it so far because the government wanted to maintain a minimum say in the running of the former state monopoly, which is still Greece's biggest telecoms company.

However, privatization revenues have been far below target. Athens has raised a total of 2.6 billion euros in cash from asset sales since a European Union/IMF bailout began in mid-2010, far less than the 22 billion it was supposed to have collected under the bailout's original terms.

Reporting by Harry Papachristou; Editing by Kevin Liffey

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