• Unions urge premier to replace management, not proceed in sale
  • Union leaders fear new owner might reduce workforce by half

About 3,000 Telekom Srbija employees and opposition activists protested in front of the government’s office on Wednesday, urging Prime Minister Aleksandar Vucic to prevent the privatization of the country’s phone company.

Protesters gathered in central Belgrade just five days before the Nov. 16 deadline for submitting binding offers expires. While Vucic has opposed a previous attempt to sell the utility when he was an opposition politician, his cabinet now expects to get more than 1.4 billion euros ($1.5 billion) for a 58 percent stake in the company.

Serbia is selling the phone company as it seeks to cut debts by privatizing its largest assets as part of its three-year fiscal consolidation program backed by the International Monetary Fund. The government also wants to sell Komercijalna Banka AD, the second biggest lender by assets, Dunav Osiguranje insurer and Belgrade airport, on top of hundreds of smaller, money-losing companies.

“I call on Aleksandar Vucic to put an end to this agony and if any change is needed, then let them change the management and protect the workers,” union leader Miroslav Joksimovic told the gathering.

Replacing Telekom’s existing management is one of five options the government has according to recommendations made by its privatization adviser, Lazard Freres & Co, Joksimovic said.

“If there is a need to sell Telekom at some point in the future, let’s wait at least for a good price, because right now, they seem to be having offers that are around 25 percent less than in 2011,” Joksimovic said.

The government got nine preliminary offers, including from Deutsche Telekom AG, Telekom Slovenije d.d. and Mobile TeleSystems PJSC, according to a privatization agency document released by former Economy Minister Sasa Radulovic on Aug. 10. The authorities accepted eight bids for further process, without disclosing identity of the bidders.

At the time, Radulovic also listed European Bank for Reconstruction and Development and Advent International Plc., Apollo Global Management LLC, Mid Europa Partners LLP, CVC Capital Partners Ltd. and Novator Partners LLP as interested parties for the stake.

Telekom unions don’t want the company to be sold to any investment fund, fearing the owner would slash staff by a half, said Slavoljub Kandic, another union leader.

“We opposed the sale in 2011 and we will continue to oppose the sale now,” Kandic said. “And we hope to succeed. Our message to the buyer is -- they are not welcome.”

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