2024-07-25 14:30:08
Tet and Mobile phone of Latvia (LMT) merger, as well as the issue of moving both companies to the stock exchange, has been relevant for a long time, and discussions on this topic continue, sometimes more quietly and more loudly. At the moment, they have escalated again, due to the Swedish shareholder Telia the prepared proposal for changes in the structure of both companies, as well as the state company Possessor market research by invited consultants. On July 16, the government, whose meeting had been invited Ernst&Young Baltic and Oaklins Baltics consultants, examined various business development scenarios, and in the Ministry of Economy (EM) For days emphasizes that in each of them the state is expected to maintain decisive influence in these companies.
For example, in the potential merger process of the two companies, the issue is their shareholder structure. The state owns 51% Tet part, and in practice the state also has decisive control over the LMT because it has a majority Tet. But in case of merger, the advantage could be gained Telia, and this means that in order to maintain a decisive influence, the public purse should be opened. The Ministry of Finance did not answer whether there are estimates of how much the acquisition of the majority shares could cost, nor did the Ministry of Finance (FM) give an answer whether, from the point of view of the currently tight budget, it would lightly support such additional expenses. The state has already purchased this year airBaltic bonds in the amount of 50 million euros.
At a disadvantage
“The current situation is not beneficial for Latvia (the country and the nation), and Tet and LMT should be merged,” believes INVL Family Office manager Andrejs Martinov. Companies compete with each other, product offerings and operational and administrative processes are doubling, as well as corporate management models or practices are different and suboptimal. In other words, if these two companies were owned by an independent investor/owner, they would have been merged long ago and their operations would become more efficient, while the return to shareholders would increase. A united company could take steps in international markets and develop exports, increase turnover, create new jobs, increase tax revenues.
Read the whole article in newspapers Day in the issue of Wednesday, July 24! If you want to continue reading the newspaper in printed form, you can subscribe to it
2024-07-25 14:30:08