Slovenian premier tries to oust defence minister in row over Telekom Slovenije sale

By bne IntelliNews April 1, 2015

bne IntelliNews -


Slovenian Prime Minister Miro Cerar asked parliament on March 31 to dismiss Defence Minister Janko Veber for abuse of office after he ordered the intelligence services to assess the impact of Telekom Slovenije's ongoing privatisation on the country's defence system.

Cerar announced his decision to seek Veber's resignation on March 30 but gave the minister one day to file his resignation himself. Since Veber failed to resign, Cerar submitted the proposal to parliament.

Cerar told a news conference on March 30 that his confidence in Veber had been shaken after the minister failed to adequately explain why he had singlehandedly engaged the intelligence services to analyse the impact of the ongoing sale. Cerar argued that there are other special bodies in charge of protecting key state infrastructure that should have been asked to make the analysis, if there had been any need for it.

Veber said on March 31, as quoted by Finance, that Prime Minister Cerar has the right to seek his dismissal, while he himself has the right to reveal what might happen if the telecom ends up in the hands of foreigners. "My conscience is clear," Veber concluded. He added he will further explain himself during the parliamentary session which will discuss his resignation.

The row could not only slow down the ongoing sale of Telekom Slovenije but has already shaken the country's governing coalition, led by the Party of Miro Cerar (SMC). Veber is a member of Slovenia's Social Democrats (SD), a junior coalition partner of the SMC, and the SD has already said it is standing behind its minister, while avoiding discussion of a possible coalition exit.

However, even if the event does result in a split in the governing coalition, the government is not endangered as it will still hold 46 seats in the 90-seat parliament even without SD.

Telekom Slovenije shares on the Ljubljana stock exchange gained 0.6% to €133.8 on Tuesday, indicating the market has become more optimistic that the recent row will not have a negative impact on the company's sale. The shares fell 3.6% on March 30 when Cerar first announced he was seeking Veber's resignation.

According to unofficial reports, the bidding deadline in the Telekom Slovenije tender was due to expire at the end of March, after being delayed several times. Local media claim Deutsche Telekom and several US and European buyout firms are in the race. In January, UK-based private equity firm Cinven became the latest potential bidder to confirm its interest in the ongoing privatisation, hinting that annual investments in the company could amount to €100mn.

Telekom Slovenije is the largest on the list of 15 state-controlled firms that Ljubljana plans to sell under a major privatisation plan adopted in June 2013. The government is reportedly eyeing €1.6bn from the sale of its 73% stake in the company.

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