Latvia aims to strengthen state ownership and control of Tet and LMT - Valainis

RIGA - The government is currently weighing options for strengthening state ownership and control of telecommunications company Tet and  mobile operator and technology innovation company Latvijas Mobilais Telefons (LMT), Economics Minister Viktors Valainis (Greens/Farmers) said Tuesday in an interview on Latvian Radio. 

Valainis emphasized that these companies are essential for Latvia's competitiveness. 

The minister said that a merger of Tet and LMT is being considered but that it still requires a lot of preparation, as there are also scenarios where the companies' structure remains unchanged. 

Valainis noted that representatives of Tet and LMT have not seen the report to the government on the companies' future. The two companies' other shareholder - Sweden's telecom Telia - has not received the full report either.

Latvia plans to start talks with Telia shortly. The government has until October 15 to to draw up a report on the talks' outcome.

As reported, the government at a sitting behind closed doors on July 16 agreed on further scenarios for negotiations with Telia, a shareholder in Latvian tech companies Tet and LMT.

The government has outlined the future course of action to be discussed with Telia and has authorized the Economics Ministry to conduct these negotiations. In mid-October, the Economics Ministry is expected to report to the government on the outcome of the talks and propose the way forward.

The economics minister previously underlined that decreasing the role of the state in these companies has not been discussed. Proposals to sell something were declined and were not considered, the minister said.

At the same time, the minister did not rule out the possibility of a buy-back of the company's shares from Telia.

The state, through Public Asset Manager Possessor, owns 51 percent of Tet, while Telia's subsidiary Tilts Communications owns 49 percent of Tet. In LMT, on the other hand, Telia and its subsidiary Sonera Holding own a total of 49 percent, the Latvian state owns a total of 28 percent through the Latvian State Radio and Television Centrer (23 percent) and Possessor (5 percent), while Tet holds another 23 percent.

A complex management scheme for Tet and LMT has been set up in the past, which the two shareholders - the Latvian government and the Swedish company Telia - have so far been unable to agree on changing.