Serbian Anti-Graft Watchdog Says Telekom Shouldn’t Be Sold

Serbian anti-graft authorities urged the government not to sell Telekom Srbija, criticizing the company’s operations as “not transparent” and saying it has been under “intense political pressure for years.”

The government may not be able to sell publicly owned resources that the country’s largest phone operator may be using, including the telecommunications network, the anti-Corruption Council said on Tuesday, according to news service Tanjug. The appeal came a day after the cabinet allowed all eight non-binding bidders to continue in the sale of the largest on a list of state-owned assets that the government has slated for auction.

“A decision to sell the company should be carefully made,” the council said, according to Tanjug. It said “experts” have warned that there are no economic grounds to sell and urged the government to restructure the company financially, Tanjug reported. Telekom Srbija’s press office declined to comment when reached by phone.

The sale is the linchpin in Prime Minister Aleksandar Vucic’s efforts to attract investment and show that Serbia is serious about overhauling an economy that has suffered three recessions since 2009. His government has also pledged to restructure or close 500 unprofitable companies as part of a stand-by loan agreement with the International Monetary Fund.

The sale of the 58.1 percent in the phone operator marks Serbia’s second attempt to place the company into private hands. Vucic has said he expects a price “significantly higher” than the 1.4 billion euros ($1.5 billion) set in a failed 2011 tender. In that process, Telekom Austria AG offered 1.1 billion euros for 51 percent.

Nine bidders, including Deutsche Telekom AG, Telekom Slovenije d.d. and Mobile TeleSystems PJSC, initially expressed interest, according to a privatization agency document released by former Economy Minister Sasa Radulovic on Aug. 10. Telekom Austria was not on that list.

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