As expected, the Cabinet decided yesterday not to join TelSource in its planned sale of Cesky Telecom (CT) shares. TelSource is to offer its 27% stake in the company on public markets. The tag-along agreement with TelSource allowed the state to join the sale of a proportionate stake in CT with TelSource. The state is the majority owner of CT, with a 51% stake.
Separately, Bloomberg reported yesterday that the Finance Ministry wants to speed up the privatization of Cesky Telecom to begin in 2004.
While the 2004/2005 period was being mentioned previously as the date of privatization launch, the timing will be mostly subject to the perceived demand from strategic investors, we believe, and the above could indicate that the ministry believes there would be sufficient bidding interest for the majority stake next year. Alternatively, the acceleration may be driven by the emerging gap (estimated to as much as CZK 52bn next year) between the planned revenues and expenses of the state National Property Fund, the administrator of the CT stake.
Jiří Soustružník