December 12, 2013 / 2:15 PM / 4 years ago

Slovenia hopes to interest Deutsche Telekom, others in Telekom -sources

FRANKFURT, Dec 12 (Reuters) - Slovenia is hoping to attract interest from Deutsche Telekom, Telenor and other telecoms groups in the stake it will sell in local incumbent Telekom, as the indebted country tries to avoid an international bailout.

State-owned investment fund SOD, which is coordinating the sale with the government, has retained Citi to organise the sale of the roughly 75 percent stake, two people familiar with the deal said.

“Deutsche Telekom and Telenor, which have a clear focus on Eastern Europe, are expected to look at the asset,” one of the sources said. Other telecoms companies and private-equity groups may join the race, the source said.

Private-equity groups that lost out in the auction of Serbian cable operator SBB are likely to look at Telekom Slovenije now, the person said. Buyout groups Cinven and Providence were among the contenders for SBB, which was bought by KKR in October.

The proceeds from the sales would be a boon for Slovenia, which was badly hit by the global financial crisis. The government expects that recapitalising Slovenian banks will cost 4.8 billion euros, which it said on Thursday it would raise itself, without becoming the latest euro zone country to need a bailout.

Telekom Slovenije’s market capitalisation is 790 million euros ($1.1 billion). In its home market -- it is also active in some other Balkan countries -- it counts 2.1 million mobile phone customers, giving it a 50 percent share of the market for mobile services. That outpaces rivals Simobil, with 30 percent, and Tusmobil, with 11 percent.

In the first half of 2013, Telekom Slovenije’s revenues were flat at about 400 million euros. Earnings before interest, taxes, depreciation and amortization slipped 5 percent to 126 million euros.

Telekom is the largest of 15 firms that the Slovenian government earmarked for sale in May.

The Slovenian government, Deutsche Telekom and Cinven declined to comment. Telenor and Providence were not immediately available for comment.

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