You are here

Clash in Swedish parliament over sale of US$7.5b telco stake

Minority government wants to keep 37% stake in Telia but majority in parliament calling for divestment

Stockholm

SWEDEN'S government wants to keep its shares in former phone monopoly Telia Co because the armed forces oppose a sale on national security grounds, Enterprise Minister Ibrahim Baylan said.

After the nationalist Sweden Democrats changed footing, the minority government faces a majority in parliament calling for a sale of the state's 37 per cent holding in the carrier, a stake valued at about US$7.5 billion.

Although the government would be obliged to consider divestment if the opposition unites, Mr Baylan said that would be wasteful, because the state would forgo billions of kronor in annual dividend payments from the holding. "I think we should listen to the armed forces and also the fact that a manoeuvre like this is also an economically bad deal," he said on Friday. "I hope they come to their senses," he said of the opposition lawmakers who are calling for a sale.

sentifi.com

Market voices on:

Telia owns copper wires that reach almost all Swedish homes and also provides secure government communications. Although the opposition wants to sell Telia, most parties acknowledge that security sensitive units would need to remain under government control. One solution is to split those parts off from the rest of the carrier. Mr But Baylan said that's a decision Sweden can't make over the heads of Telia's other shareholders.

Momentum for full privatisation divestment is building after Telia agreed to buy Bonnier AB's television operations for 9.2 billion kronor (S$1.35 billion), including private broadcaster TV4. BLOOMBERG