Telekom Austria May Spin-Off Landline Operations

It is being reported that Telekom Austria Group could look to divest its landline division into a separate company so that the overall company is not held back by legacy issues from its time as a state-owned company. When the company was originally floated, the staff were given civil servant grades along with commensurate benefits and salary - including a guarantee of no redundancies.

Under the plan, proposed by the governing Social Democrats' economic spokesman Christoph Matznetter in an interview with newspaper Die Presse, cited by the Reuters news agency, Telekom Austria would still be able to offer fixed-line services but would not own the network anymore.

The landline division would be transferred to the state's holding company, OeIAG, which owns 27.37 percent of the Telekom Austria Group, with the rest floated on the stock market

Telekom Austria declined to comment on the plan.

Last year, the Egypt based Orascom Telecom Holding was rumoured to be in talks which could lead to it merging with Telekom Austria. At the time, the company said that it is - in principle - open to taking part in a large-scale merger in coming years, if the right opportunity comes along, and if the Austrian state agrees.

On the web: Reuters

Posted to the site on 15th June 2009