Sweden's state-owned telecoms firm, Telia, has said it is reassessing its decision to sell its 14 per cent stake in Eircom. This follows the formation of a new board after the company's planned merger with state-owned Norwegian firm Telenor collapsed last month.
Telia also repeated that it was not interested in acquiring telecoms firm Esat, which is fighting a $1.9 billion (€1.8 billion) hostile bid by Telenor. The initial bid for Esat was made jointly by Telia and Telenor when their £47 billion (€59.7 billion) merger was still proceeding, but the Norwegian firm took full control of the offer when discussions between the two firms broke down.
After his appointment as chief executive of Telia yesterday, Mr Jan-Ake Kark said it was too early to say if the firm would sell its stake in Eircom. This and other strategic matters had yet to be considered by its new board, he said.
Mr Kark's comments come just a week after his predecessor, Mr Stig-Arne Larsson, who was Telia's acting chief executive, told the Swedish newspaper Finanstidningen that it planned to sell its stake in Eircom.
"My view is that we've already got the most out of this investment. The money could be used better elsewhere," Mr Larsson had said.
But Mr Kark said yesterday that it was "too early to say what will happen" to Telia's stake in Eircom. He added: "We have to discuss that in the coming weeks . . . but the Irish market is very interesting as I think it could be some kind of hub for electronic commerce between Europe and the US."
Confirming that Telia was reassessing its decision to sell its stake in Eircom, a spokesman declined to elaborate on Mr Kark's comments on e-commerce. Mr Kark was unavailable for comment last night.
While a decision by Telia to retain its shareholding would be a boost to the Irish firm, it is still thought likely on balance that Telia will sell its shareholding.
The Dutch telecoms company KPN is already planning to sell its 21 per cent share in Eircom. It is understood that it will be some weeks yet before a final decision will be reached on the disposal of this shareholding, which was first announced last November.
Telia originally planned to sell its sake in Eircom to avoid a potential conflict of interest with Telenor, which owns 49 per cent of Esat Digifone, the second mobile phone operator. Eircom owns the Republic's only other mobile phone business, Eircell.
Irish and EU competition regulations would have prevented the merged group, to be known as Newtel, from holding stakes in competing mobile operations.
