Sweetheart stink

24 April 2008 By Una Galani Follow @ugalani

The German telecom group is trying to cut a cosy deal with the Greek government that would allow it to take control of the former Hellenic monopoly with just 25% of shares. Once again political meddling threatens to deprive OTE minorities of the full value of their shares.

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The Greek government and Deutsche Telekom have failed to reach an agreement on the sale of a stake in OTE telecom. The two sides have for the month been trying to agree a deal that would allow them to cover the Balkans telecoms market. Talks will continue next week.

DT has an agreement to buy 20% of OTE from Greek private equity group Marfin, providing it can get a further 3% of the government's 28% holding and secure management control.

In the event of a deal, the two sides are understood to have agreed that the Greek government will select the OTE chairman, while DT will choose the chief executive. The 10member board is expected to be split half and half.

Earlier this week, OTE chairman and chief executive Panagis Vourloumis said: Joint management, as regards to operating decision…are a catastrophe. They lead to paralysis and bad compromises.

The two sides have set a May 7 deadline to finalise a deal.

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