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Merged Rostelecom to stay state-controlled -Minister

* Telecom minister says no risks of state losing control

* Plays down concerns voiced by Economy Minister

* Govt had ordered audit in the merger over concerns

BRUSSELS, Dec 7 (Reuters) - Russian telecom group Rostelecom RTKM.MM, at the centre of a merger of state holding company Svyazinvest's units, will remain state-controlled once the merger is completed, Communications Minister said on Tuesday.

Moscow last year approved a major reform for Svyazinvest through a merger of Rostelecom with seven regional operators that Svyazinvest also controls, with the aim of government playing a bigger role in the telecoms sector. [ID:nLK486977]

But the government has recently ordered an audit into how operators were valued for their merger due to concerns its influence over the telecom combination could be diluted, business daily Vedomosti reported last month. [ID:nLDE6A90YX]

The concerns were based on the fact that the government would directly own less than 50 percent of the merged company, though it will have indirect control via two state entities -- the Deposit Insurance Agency and development bank VEB. “According to all our estimates ... the share under state control will be more than 50 percent,” Igor Shchyogolev told reporters.

“We proceed from the assumption that these institutions are controlled by the state, and respectively this is all part of the state-controlled stake,” Shchyogolev said.

The Svyazinvest reform, scheduled to be completed in the first quarter of 2011, has also been clouded by a boardroom struggle and the growing influence of minor shareholder Marshall Capital Partners, an investment fund. [ID:nLDE68T22I] (Reporting by Alexei Anishchuk; writing by Maria Kiselyova; Editing by Will Waterman)

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