LONDON (Reuter)–The Armenian government is expected to complete the sell-off of its main telephone company Armentel by the end of third quarter this year–the main adviser to the sale–Merrill Lynch International–said on Wednesday.
A Merrill Lynch director–Paul Pittman–told Reuters that the government of Armenia was expected to either sell its entire 51 percent stake in the company or 36 percent in the telephone firm.
Transworld Telecommunications Inc.–the US-based company which controls the balance 49 percent would sell its whole holding during the sale–Pittman’said.: Armenia to complete telephone
"It (the sale) is representative of what I believe is the free market approach of the Armenian government as a whole," Pittman’said.
Due diligence with regard to the sale is expected to come from potential buyers in the next 10 days–after which the candidates are expected to visit Armenia in the next six to eight weeks.
Pittman’said the Armenian government had no preference on its mind and would offer it to the highest bidder "which has a successful operating history."
It is expected that bids could come in from about 20 global telecommunications firms.
Merrill Lynch did not comment on possible prices but is expected to be around or above $1,000 per access line. Armentel has 700,000 lines for a population of about 3.5 million people.
The Merrill adviser said Armentel had made about $8.0 million profits in 1996 but is expected make profits of $37 million in 1998.
Currently–Armentel exists as a joint venture between the government of Armenia and Transworld Telecom.
The joint venture initially covered international services but has gradually taken on local services in capital Yerevan and the rural areas and also plans to cover paging and cable television services.
The revenue from international calls by a multitude of Armenia’s living outside the country is seen as one of the main attractions in the sale.