• Sweden edition
 

TeliaSonera to increase stake in Estonian telecoms firm

Published: 23 Sep 2009 15:32 GMT+02:00
Updated: 23 Sep 2009 15:32 GMT+02:00

Estonia is set to sell its share of leading telecommunications provider, Eesti Telekom, to Nordic group TeliaSonera.

On Wednesday Estonia announced that it was set to sell its 27 percent stake in Eesti Telekom to the Nordic group TeliaSonera, which already owns 61 percent of the company.

“The general agreement on the deal has been reached by the government and the proposal will be discussed at the cabinet session on Thursday,” finance ministry spokeswoman Kristi Joesaar told reporters.

At the end of August, Swedish-Finnish telecommunication player TeliaSonera made a 5.1 billion-kroon ($482 million) bid for the remainder of Eesti Telekom.

The government itself owns 24 percent of Eesti Telekom, while the state-run

Estonian Development Fund holds three percent and the rest belongs to a range

of smaller shareholders.

TeliaSonera -- which has assets across eastern Europe and Central Asia -- first became involved with Eesti Telekom as a minority investor in the early 1990s.

"The state has no strategic interest in having a holding in one of the telecommunications companies, in fact the holding is at odds with the role of the government as a regulator and supervisor of fair competition," Finance Minister Jurgen Ligi said in a statement Wednesday.

Ligi said the deal would inject around four billion kroons into state coffers over the coming three years, thanks to the cash-for-shares offer, extraordinary dividends and income tax on dividends.He underscored that the sale would aid Estonia amid a deep economic crisis.

"These funds would allow the state to borrow less or keep higher reserves. According to current forecasts there will be a saving on interest costs of 260

million kroons," he explained.

Estonia, which shifted rapidly from a communist command economy to the free market after independence from the Soviet bloc in 1991, had enjoyed a reputation as a "tiger" in the European Union, which it joined in 2004.

But the country of 1.3 million people swung into a sharp recession in 2008 and its economy is forecast to shrink by 15.3 percent this year. The government has made repeated spending cuts to try to tackle the crisis. Splits over the savings drive sparked the collapse of Estonia's centrist coalition in May.

Estonia's left-wing opposition blasted the current centre-right minority cabinet over the Eesti Telekom move.

"In the longer term, the state's share in Eesti Telekom is a stable source of income. Tackling the current financial situation by drawing a relatively small sum from the deal means the state's giving up a regular income source in future," said ex-finance minister Aivar Soerd.

Since 2004, the Estonian state has earned a 2.18 billion kroons in dividends from its Eesti Telekom shares, and 2.53 billion kroons in tax revenues on dividends, official data shows.

TT/Charlotte Webb (news@thelocal.se)

Don't miss...X
Left Right

Your comments about this article

Today's headlines
Sponsored Article
On the move: Sweden's shifting mobility trends
House keys: Shutterstock.

On the move: Sweden's shifting mobility trends

Finding somewhere to live when you move to Sweden is a challenge. With changes afoot The Local caught up with an expert from letting agency Residensportalen to find out in what direction the market is going, and how Google Glasses may just help you find your dream home. READ () »

The Local List
Ten most disgusting Swedish foods
Salty liquorice, anyone? Photo: Anders Wiklund/TT

Ten most disgusting Swedish foods

Swedish food is, of course, a matter of taste. But it's mostly disgusting. Our loyal followers on Twitter and Facebook shared what they thought were the worst of them all. READ () »

Sweden wants cruise missiles 'for defence'
Defence Minister Karin Enström. File photo: TT

Sweden wants cruise missiles 'for defence'

The Swedish government has announced plans to beef up its defence forces by fitting its fleet of Gripen fighter jets with long-range cruise missiles. READ () »

Swede of the Week
Sweden's oldest would-be MP: 'They promised I wouldn't get in'
Swedes vote in the 2010 elections. File photo: Dan Hansson/TT

Sweden's oldest would-be MP: 'They promised I wouldn't get in'

Gösta Arvedson, 89, is the oldest Riksdag candidate in Sweden, but our Swede of the Week explains that the Liberal Party (Folkpartiet) had to make some unusual promises for him to put his name forward. READ () »

Elections 2014
Most Swedes lack info ahead of EU vote
The Green Party is one of only two parties devoting their websites to the EU elections. Here campaign manager Emma Rung presents the party's posters. Photo: Leif R Jansson/TT

Most Swedes lack info ahead of EU vote

The majority of Swedes feel the country's political parties are not doing enough to inform them about the upcoming European Parliament elections. Only two of the eight parties have dedicated their homepages to the May 25th polls. READ () »

Fatal Norrköping Brawl
Local church tried to stop Norrköping murders
Swedish police on the scene following Monday's fatal brawl. File: TT

Local church tried to stop Norrköping murders

The Syrian-Orthodox Church in Ektorp had tried to quell tensions between two rival families just hours before bad blood spilled into a massive brawl and two brothers lost their lives. READ () »

JobTalk Sweden
'Foreigners don't need to show banks Swedish ID'
The bridge that connects Sweden to the European continent. File: L.E. Daniel Larsson/Flickr

'Foreigners don't need to show banks Swedish ID'

The Swedish agency that helps Europeans fight impediments to the EU principle of free movement has revealed an increase in complaints, including one from a foreign citizen unable to open a bank account in Sweden. READ () »

Eurovision 2014
Pig heart shatters in Sweden's Eurovision clip
Sanna Nielsen in the new clip. Photo: YouTube (screenshot)

Pig heart shatters in Sweden's Eurovision clip

Sweden's Eurovision hopeful Sanna Nielsen released the official video for the song Undo on Wednesday, a clip featuring leather, slow motion destruction, and a frozen pig's heart and some violence. READ () »

Software robot pinches Swedish flats in seconds
Swedish apartments. File: The Local

Software robot pinches Swedish flats in seconds

A Swedish landlord suspects that a property fixer has set up a software robot to sign up for new flats on the market within seconds, and is charging house hunters to use the service. READ () »

Swedish zoo fire 'kills only the spiders'
Photo: Johan Nilsson/TT

Swedish zoo fire 'kills only the spiders'

Twenty-five fire fighters were on hand on Wednesday night when a fire broke out in a southern Sweden animal park. The vast majority of the animals were unharmed, but the cluster of spiders wasn't so lucky. READ () »

RECEIVE OUR NEWSLETTER AND ALERTS
Shutterstock
Sponsored Article
On the move: Sweden's shifting mobility trends
finest.se
Gallery
People-watching April 23
TT
Gallery
Inside the 850-year-old king's coffin
Features
Sponsored: South-eastern Sweden offers Öland beaches and more
Gallery
Swedish underwear shop puts staff in front of the camera
Gallery
IN PICTURES: The Local's Property of the Week - Täby
Sponsored: India+Sweden Week - India Unlimited
Features
Sponsored: India+Sweden Week - A film, food, and finance feast
National
University applications rocket to record high
finest.se
Gallery
People-watching April 18-20
TT
Society
Kids in Victorian garb mark Swedish Easter
Shutterstock
National
Swedish MP ordered chemtrail probe
Society
Swedish supermarket Ica pulls contested Easter commercial off air
Advertisement:
Kungahuset
Society
Swedish royals set baptism date for princess
finest.se
Gallery
People-watching April 16
Politics
Who's the prime minister's heir?
Alfie Atkins
Society
Are children's books the key to families integrating in Sweden?
National
'Sweden Dem protests cater to party's martyr image'
National
'Swedish research grants were fantastic, but now it's like Australia'
Society
Only in Sweden: The ten problems you'd never encounter elsewhere
National
Swedes stopped to take my picture, but didn't look me in the eyes
Business & Money
A swipe of the hand replaced cash and cards in Lund
YouTube
Features
Video: Oliver Gee finds out how to embrace The Swedish Hug
TT
National
Abba duo hints at reunion
Private
National
Flash mobs hug it out across Sweden
Stockholm School of Economics
Sponsored Article
Why a bachelor's degree is no longer enough
Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

Blog Update: The Diplomatic Dispatch

28 October 15:16

The Green Growth Group Summit »

"Today on the 28 October in Brussels, a large group of key EU Ministers and business people, including UK Secretary of State for Energy and Climate Change Edward Davey, and Swedish Environment Minister Lena Ek, will meet to discuss green growth. They all have a stake in resolving a challenge which, although it is crucial..." READ »

718
jobs available
Swedish Down Town Consulting & Productions
Swedish Down Town Consulting & Productions is an innovative business company which provides valuable assistance with the Swedish Authorities, Swedish language practice and general communications. Call 073-100 47 81 or visit:
www.swedishdowntown.com