Telekom Slovenije Plunges After Stake Sale Draws Sole Bidder

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Telekom Slovenije d.d., the most valuable piece on Slovenia’s asset sale list, plunged the most in more than two years after the government received just one bid for a majority stake in the phone company.

The country’s state asset manager said Monday it received one binding offer for the stake, without identifying the bidder. Cinven placed the bid, two people familiar with the matter said Tuesday. The buyout firm may have offered as much as 120 euros ($128) per share, one of the people said. The shares dropped 6.9 percent to 119.2 euros by the end of trade in Ljubljana, the steepest decline since January 2013 on a closing basis, after sliding as much as 10 percent.

“The main question is why only one bid, as in the current mergers and acquisitions environment we should definitely expect more,” Saso Stanovnik, head of research at the Ljubljana-based brokerage Alta Invest d.d., said by e-mail. “It’s maybe due to outstanding lawsuits, which are definitely hard to resolve and included in the transaction price or probably investors have better opportunities elsewhere and don’t want to bother with difficult Slovenian politics.”

Telekom Slovenije, with a market value of 779 million euros, is the most valuable company among the 15 slated for sale by the previous government in 2013. The list was extended by Prime Minister Miro Cerar, who has said the sale may be canceled if the offered price is too low.

Privatization Commitment

Deutsche Telekom AG decided against an offer because of concern about the value of the asset and regulatory matters, two of the people familiar said. The German company could revisit a bid later, one of the people said.

“The process isn’t completed yet and we can’t comment further,” Tina Strafela, a spokeswoman for the Slovenian government, said in an e-mailed response to Bloomberg. The sale process “continues and we are studying the binding offer,” Sovereign Holding, the state asset manager, said in an e-mail.

Slovenia has been the slowest among eastern European Union members to sell state assets and fix their corporate governance.

Even at a lower-than-expected price, completing the sale “would be a sign of commitment to privatizations,” Lutz Roehmeyer, who helps oversee about $1.1 billion of emerging-markets assets at Landesbank Berlin Investment GmbH, said by phone.

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