Slovenia says privatisations still on track despite of delays

Telekom Slovenije, D.d

13/02/2015 14:30

By Marja Novak 
    LJUBLJANA, Feb 13 (Reuters) - Two major privatisations 
slated for this month might be delayed because of procedural 
problems, but Slovenia remains fully committed to its sell-off 
programme, the finance ministry said on Friday. 
    Slovenia, which has been reluctant to sell its major firms 
since gaining independence from Belgrade in 1991, earmarked 15 
firms for privatisation in 2013 as it narrowly avoided an 
international bailout. 
    However, only three have been sold to date and the 
government still controls about half of the economy. 
    In the latest setback, Finance Ministry State Secretary 
Metod Dragonja said the sale of telecoms operator Telekom 
Slovenia  TLSG.LJ , and the country's second largest bank, Nova 
KBM (NKBM), might not be completed this month, as expected. 
    Addressing a parliamentary board for the supervision of 
public finances, Dragonja said both sales could be delayed 
because the bidders wanted further information on possible legal 
liabilities facing the two companies. 
    "The government and the Slovenian Sovereign Holding are 
doing everything to keep the highest possible dynamics of the 
(privatisation) process," Dragonja said. The Sovereign Holding 
is a state investment firm that is coordinating sell-offs. 
    Various sources have told Reuters that international 
investment funds Cinven, Providence, Apax and Bain Capital are 
among the bidders for Telekom, the largest company on the 
privatisation list, along with German telecoms operator Deutsche 
Telekom  DTEGn.DE .  ID:nL6N0V74F4  
    However, Dragonja said the bidders were concerned about 
several court cases against the company for allegedly abusing 
its dominant market position. Local media has said these could 
result in damages of up to 440 million euros ($500 million). 
    In the case of bank NKBM, the Slovenian Association of Small 
Shareholders has sued it, saying shareholder capital and 
subordinated bonds should not have been erased when the bank was 
rescued by the state in 2013. 
    Hungarian bank OTP  OTP.BU  and U.S. investment fund Apollo 
are bidding for NKBM, sources and local media have reported. 
 ID:nL6N0V5117  
    The Slovenian government had to pour more than 3 billion 
euros into local banks in 2013 to prevent them from collapsing 
under bad loans. During the process, which enabled the country 
to avoid an international bailout, the government nationalised 
the rescued banks, among them NKBM.  
    The Bank of Slovenia said on Wednesday it had acted in line 
with EU legislation when it put together the rescue 
packages. ID:nL5N0VL4KC  
    Supporters of Slovenia's privatisation plan say the 
sell-offs are needed to bring fresh capital into the country and 
provide it with long-term financial stability.  
    However, an opposition party and several civil society 
groups are protesting against the disposals, complaining that 
top companies will end up in foreign hands.  ID:nB4N0V002W  
 
 
($1 = 0.8775 euros) 
 
 (Reporting by Marja Novak; Editing by Crispian Balmer) 
 ((Marja.Novak@thomsonreuters.com; +386-1-5058805; Reuters 
Messaging: marja.novak.thomsonreuters.com@reuters.net)) 
 
Keywords: SLOVENIA PRIVATISATION/