Bloomberg News

Kosovo Cancels Sale of PTK Phone Company, Economy Minister Says

October 17, 2011

Oct. 17 (Bloomberg) -- Kosovo canceled the sale of Posta dhe Telekomunikacioni i Kosoves Sh.A., the country’s state-owned telecommunications company, due to a corruption investigation at the company.

“The government’s commission for the privatization of PTK has decided to cancel the process and start a new one,” Besim Beqaj, the Minister for Economic Development, told reporters in the capital Pristina today.

T-Hrvatski Telekom d.d. of Croatia and Telekom Austria AG were chosen in June as the finalists for as much as 75 percent of the phone company. The Zagreb-based operator, majority owned by Deutsche Telekom AG, said in July it may back off from the purchase due to the probe.

The Kosovo government led by Prime Minister Hashim Thaci is struggling to cut the budget deficit and the sale was meant to cover part of the expenditures.

The predominantly Albanian province that declared independence from Serbia in 2008 had its financial assistance from the International Monetary Fund and the European Union withheld due to an increase in public-sector wages and a failure to cut spending, the European Commission said on Oct. 12.

--Editors: James M. Gomez, Douglas Lytle

To contact the reporters on this story: Boris Cerni in Ljubljana at bcerni@bloomberg.net;

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net


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