The Croatian telecom T-HT is considering dropping its bid for Kosovo's state-owned post and telecom firm PTK after managers of the Kosovan company were charged with corruption, Reuters quoted T-HT as saying on Tuesday.
T-HT, majority-owned by Deutsche Telekom (DTEGn.DE), and Telekom Austria were shortlisted in June in the race for 75 percent of PTK, just days before European Union prosecutors charged its chief executive and four others.
"In light of the charges recently filed against certain PTK managers suspected of corruption, T-HT is currently reviewing its continued participation in the privatisation process," spokeswoman Maja Weber told Reuters from Zagreb.
PTK's chief executive, Shyqyri Haxha, and its board chairman, Rexhe Gjonbalaj, are accused of making "harmful contracts" and abusing official positions. A trial has not started yet. Haxha has dismissed the accusations.
The sale of PTK was expected to net between 300 and 600 million euros ($409-$819 million), funds already pencilled into the 2011 budget, according to Reuters.
The Kosovo government is facing a budget crisis after the International Monetary Fund ended a 108 million euro stand-by arrangement with Kosovo this year when the government deviated from its agreed programme by increasing public sector wages.
Arsim Brucaj, project manager for the telecom sale, said the commission for privatisation was analysing the situation and would very soon announce steps to be taken next to complete the process.
PTK, the most profitable firm in Kosovo, has around 1 million mobile and 100,000 landline subscribers and also provides internet services.
