Updated at 15:34,14-12-2017

Government fails to sell stake in mobile phone network MTS

Naviny.by

The government failed has failed to sell its 51-percent stake in mobile phone network Mobile TeleSystems (MTS) through a bidding contest.

Scheduled for February 6, the contest had to be cancelled because no bids had been received, according to the press office of the State Property Committee.

The stake in MTS was offered for sale on condition that the operator’s coverage would not decrease compared with the previous review period, the press office said, adding that the sale of the asset has been ordered by Alyaksandr Lukashenka.

The State Property Committee announced on December 11 that it had invited bids for the government's stake in MTS and would accept them through February 5, 2014.

The Committee said that the starting price of the asset was $863 million, and that the winner of the contest, the highest bidder, would be selected on February 6.

Mr. Lukashenka announced in March 2011 that he was ready to sell the Belarusian government's 51-percent stake in MTS to Russia's Mobile TeleSystems, which owns the other 49 percent, for $1 billion. However, the Russian company found the price too high.

The government failed to auction off the stake at the end of 2011. The auction was cancelled because the bidders had reportedly offered too little for the stake.

Mr. Lukashenka said in November 2012 that the government would not lower the price of its stake in MTS, Belarus’ largest mobile phone operator.

"MTS is a very profitable company," he said. “We are in no hurry to sell it, but there were urgent requests for that. We had to evaluate the company once again. Today the controlling stake is worth more than $1 billion. We know that for sure. We have a confirmation to all this.”

While meeting with CIS media leaders in Minsk this past October, Mr. Lukashenka indicated that he was ready to sell the stake for $900 million.

When a journalist remarked that Belarus was asking too much for the stake, $1 billion, Mr. Lukashenka said that "there is no such concept as 'cheap' or 'expensive' in economics and finance," and that the price of an asset is determined through talks or bidding contests.

Mr. Lukashenka said that he would not sell MTS to bidders offering $500 million for it. But if they offered $900 million for the asset and not $1 billion, its estimated value during the period of high demand, "I would sell [it] today," he said.

Founded in early 2002, MTS reportedly had more than 5.3 million subscribers as of October 1, 2013, 3.7 percent more than three months before.