Albania's Albtelecom sold

19/07/2007

Two years after the initial bid, Albania's state-owned fixed telephony company has been purchased by a Turkish consortium.

By Jonilda Koci for Southeast European Times in Tirana – 19/07/07

Albanian Minister of Economy, Trade and Energy Genc Ruli (right) and Calik Enerji Ahmet Calik Chairman sign the agreement on the sale of Albtelecom last month in Tirana. [Getty Images]

Albania's government has sold 76% of the state owned fixed telephony company Albtelecom to Calik Enerji Telecommunications, a Turkish consortium consisting of Calik Enerji and Turk Telekom. The price was 120m euros.

"We hope to complete the share transfer operations for Albanian Telecom in the near future," a statement released by the Calik Group chairman said. Albanian government authorities say the deadline for the transfer will be in September.

The sale -- which was completed late last month -- also includes a license to provide Albania's third mobile phone network. The government included the license in the privatisation package as an incentive. However, it will be up to the investor to actually build the network, to be called Eagle Mobile.

"Albania will soon have serious investments in fixed telephony and a new mobile company, which will guarantee competitiveness, quality and lower prices," Albanian Minister of Economy Trade and Energy Genc Ruli said after signing the contract on June 19th.

"Creating a proper environment for the rightful and honest competition is the promise we give today … and that is also an obligation towards consumers and investors," he added.

The process of privatising Albtelecom has been a long one. The initial bid for the telecom was issued in May 2005. The Calik Group was the sole bidder at the time, but the contract approved by the former Socialist government wasn't ratified in parliament. The new right-wing government that came into power in July 2005 halted the sale, claiming irregularities.

Under the new government's requirements, Calik had to maintain a partnership with a strategic telecom operator. To comply with this requirement, the company formed the consortium with Turk Telekom, which has a 20% stake.

The Albanian government will be represented on Albtelecom and Eagle Mobile's supervising boards for the next five years, or until the government's stake drops to 10%.

Albtelecom holds a monopoly on fixed telephony services, reaching 33% of Albania's 800,000 households and 7% of the country's 3.6 million people. The company currently brings in annual revenue of 120m euros.