Swedish Government Hopeful Of Solving TeliaSonera Spat

STOCKHOLM -(Dow Jones)- The Swedish government hopes it will be able to lend Swedish telecommunications operator TeliaSonera a helping hand in solving the company's problems in gaining control of Turkish telecom operator Turkcell, Financial Markets Minister Mats Odell told Dow Jones Newswires.

Odell wouldn't elaborate on any actions or strategies the government plans on the issue.

Alfa Group Russia could, however, be a key player in resolving TeliaSonera's problems as it owns 13% of the shares in Turkcell, a stake it bought from Turkish company Cukurova Holding in 2005.

Alfa's deal with Cukurova came after TeliaSonera failed to finalize a previously signed agreement with the Turkish company to take over its entire 27% in Turkcell.

TeliaSonera owns 37.3% of Turkcell and wants to get a majority in order to consolidate the company and exercise more control.

Odell said he has had no contact with Alfa on the issue.

"There was a meeting between Alfa and representatives of the former government. The current government has had no contacts with them," said Odell, who took office after a center-right coalition won the Swedish elections in September 2006.

An arbitration tribunal in Geneva last week concluded that TeliaSonera's 2005 agreement with Cukurova to buy the 27% stake in Turkcell for $3.1 billion is a binding share purchase.

It is, however, still unclear if a deal will actually happen.

The Swedish government owns a 45.3% stake in TeliaSonera but has declared it wants to sell its holding. Investors and media have speculated the stake could be used to swap with Alfa's stake in Turkcell.

Odell wouldn't comment on the possibility for such a deal.

The government hasn't given any clear timeframe for the sale and Odell wouldn't say when he thinks the issue with TeliaSonera and Alfa could be resolved or on how good are the chances. "I hope it can be resolved," he said.

-By Magnus Hansson, Dow Jones Newswires; +46 8 545 130 91; magnus.hansson@dowjones.com

(END) Dow Jones Newswires"

Posted to the site on 1st February 2007