| Papua New Guinea’s government decided not to sell part of state-owned telecommunications provider Telikom PNG, thus ending a joint venture's bid for the company, Prime Minister Michael Somare said.
The joint venture of South Africa's Allied Technologies (Altech) and Econet Wireless had bid 150 million kina (US$ 46 million) for a 51% controlling stake in Telikom. Somare said they decided not to sell the stake after disputes within PNG over details of the sale. Opponents of the sale within PNG believe the sale process had been handled poorly and would lead to profits moving offshore.
"Given the debate from various sectors of the community and the parliamentary resolution not to proceed with the sale under its current structure, the cabinat has decided that the most logical step is to cancel current attempts to sell this important state asset," Somare said.
"Should the government decide to re-tender in 2005, all parties will be asked to submit their bids, including Econet Wireless," he said.
Altech purchased a majority stake in the Econet Wireless Group last month. At the time, Altech said that it would waive a requirement for Econet to obtain government approval to invest in Telikom, a transaction for which it also set aside 30 million rand.
Faced with a large debt load, Papua New Guinea announced plans three years ago to sell a range of public assets in various sectors including telecommunications, transportation and banking. The Altech-Econet joint venture is the most recent in a line of failed bidders, including Telikom Korea and a Fiji-PNG joint venture.
The board of Telikom, including chair Florian Gubon, was recently dismissed over the handling of the sale. However, on Monday, Somare ordered Gubon and the board to be reinstated.
Intelecon Research & Consultancy Ltd. 15/12/2004
Source: Reuters |