The Cabinet yesterday approved a reduction in the opening price of the UMTS-license auction, from CZK 6.7 bil. per license to CZK 3.5 bil. (CZK 1 bil. to be paid this year, and the rest plus interest over the following 10 years). The decision, which was announced after the end of trading on the PSE, is good news for both telecom stocks (though the market probably expected a reduction). The mobile operators did not officially respond to the decision yesterday, so we do not know yet whether the reduction is sufficient for them to participate in the auction, or whether they will undertake the risk of abstaining in an effort to achieve a still greater reduction. We will know this by Friday, November 30, when operators’ bids are due.
(Ondrej Datka)