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Lahovnik Proposes Audit of Telekom's Deals in Balkans

Ljubljana, 02 February (STA) - Economy Minister Matej Lahovnik assessed on Tuesday that audits into the acquisitions of Macedonian mobile operator Cosmofon and Kosovo's Ipko by Slovenian telcoms operator Telekom Slovenije should be launched in order to respond to suspicions of irregularities in the deals.

Lahovnik added that the decision to audit Telekom's deals in Macedonia and Kosovo is in the jurisdiction of the telco's supervisory board, the Economy Ministry told STA.

The minister believes that supervisors will take into account the possible reasons for an audit of the deals. If there is no audit, the state as the majority owner of Telekom Slovenije will propose it at the next general assembly.

According to Lahovnik, the purchase of stakes from some minority shareholders in both deals should be put under particular scrutiny.

The minister responded to a report in today's daily Dnevnik, which says that Telekom was being suspected of heavily overpaying its takeover targets in its expansion to Southeast Europe, while also being excessively generous to minority shareholders.

According to the paper, some minority shareholders in Ipko decided to sell in late December, receiving tens of million euros from Telekom. Dnevnik added that the role of other owners, which include former director Akan Ismaili and Factor banka, a bank whose background was never revealed, is also disputable.

Telekom's vice-president Dusan Mitic, who is in charge of regional expansion, is convinced that an audit would show that everything was carried out in line with the legislation.

The Slovenian national telco is also believed to have overpaid Cosmofon as other bidders offered substantially less for the company.

Telekom purchased a majority stake in Ipko in the summer of 2006, and has so far invested EUR 200m in its expansion in Kosovo.

The company last year acquired Macedonia's no. 2 mobile operator Cosmofon and its main distributor Germanos Telecom Skopje (GTS) for EUR 190m.

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