RomTelecom consultant, a delicate matter

Selecting a consultant for the second stage of privatisation of the national telecommunications operator RomTelecom could be postponed for next year, market analysts say, although Communications minister Dan Nica had announced last month that the process was due to take place in October.

The Ministry informed early this week that “the announcement and the job specifications book for the tender to select an international consultant have been finished” and “the Finance Ministry is expected to endorse the beginning of the tender.”

Analysts say having the tender now would be a rather delicate matter, given that the police are hearing former ministers and even former PM Radu Vasile about the legality of paying the success fee to the consultant for the first stage of RomTelecom’s privatisation.

The company has yet to go public with the H1 results, after having ended Q1 with only $4 million in profit, down 68% against the year-ago period. As soon as the results were announced, RomTelecom’s top management underwent some changes and is now under reorganisation, company sources say.

The consultant to win the tender will present a report on the methods, the amounts of money and the strategy to embrace in the privatisation process. The decision about the circumstances in which RomTelecom’s privatisation is to continue will be based on this report.

“We will take several factors into account, such as the situation of the international market, the interest shown for this privatisation process, the economic situation of the company to be privatised,” sources with the IT&C Ministry (MCTI) told Ziarul Financiar.

“After the job specifications books are bought, MCTI has to announce the type of tender to be held. Consultants usually submit a letter of intent with the necessary presentation and the Ministry puts together a short list, of six to ten companies.

The first privatisation stage of RomTelecom registered 37 consultants. The selection of the consultant will most likely take three to five months, with the actual privatisation to be concluded late next year.

At least that’s what I think. It is the consultant that counts at the moment, that will probably make a recommendation as to how large a stake to put up for sale and about the selection procedure,” Sorin Pantis, former Communications minister, maintains.

Minister Nica has recently said the State may sell its entire stake in RomTelecom, that is 65%, if the consulting company says so.