MCTI and OTE: Romtelecom’s listing depends on the state of the stock exchange

“Optimistically speaking, October-November is the period in which we foresee the listing, provided all goes well. We have also discussed this with OTE and agreed that, if all goes well, we will get onto the market in fall. We are speaking with the Bucharest Stock Exchange, as well as with the stock exchanges in London and Vienna,” according to a statement for Business Standard by Karoly Borbely, Minister of Telecommunications.

The Romanian state owns 46 percent of Romtelecom, through its Ministry of Telecommunications and IT (MTCI), while the remaining stock belongs to majority shareholder, Greek OTE group, which also serves as the company’s manager.

Minister Borbely indicated that he has already consulted with Romtelecom representatives and that the procedure to select a consultant for the IPO of the telecom company’s shares has already been initiated. “Investor interest in the Central and Eastern European telecom market is still high. We want to have a positive impact, and not least, the price obtained by the state should be as high as possible,” said the Minister.

“OTE Group is not opposed to the listing of Romtelecom, but cannot agree to this first entry onto the stock exchange regardless of conditions. The present economic-financial-stock exchange context is not at all a favorable one, which practically speaking means there is an under valuation of the operator’s shares,” according to a statement for Business Standard by a telecommunications market source.

On the other hand, even the operator’s performance could make a successful listing questionable, since analysts are unanimously indicating that 2008 will be a year marked by an intensification of competition on the telecom market.