Nov 19 - GSD Raises Questions Regarding Gibtelecom Share Purchase
The GSD Opposition notes the Government’s announcement on Monday of the purchase by it of the 50% shareholding held by Telekom Slovenije, the Slovenian state-owned company. The GSD also notes the Government’s explanation describing the move as ‘strategic’ in nature given that it wants to have control (by exclusively holding all the shares) as to who the next partner will be.
Whilst the Government’s thinking is appreciated by the Opposition, it says it nevertheless has questions to which it seeks answers now, particularly because the announcement has been made after the deadline for asking questions at this week’s Parliament.
For example, it is known from press reports that Telekom Slovenije purchased its 50% shareholding in 2007 for Euros 36.8 million. What valuation has been done which led the Government to purchase at some Euros 11 million extra? Since when has the Government known that the Slovenian group was to be sold and in this context why has an alternative purchaser not been identified earlier if this was possible? This is public money and the issue affects a company which is soon to be fully owned by the public, it therefore has a right to know, says the GSD.
In keeping with its transparency obligations the Government is also asked by the GSD to state where the funding is coming from. This is not expenditure which was voted at the last budget and according to the GSD, “there are serious concerns as to the state of Gibraltar’s finances, including the use to which Credit Finance Company Limited is being put to.”
Furthermore, previous Governments, including the GSLP and the GSD, have continued a business model for Gibtel which has always featured a private stake-holding from outside of Gibraltar. Whilst the Opposition also notes that the Chief Minister will not be rushed in the decision to identify a new partner it is imperative that a “suitable private stake-holding is found as soon as possible.”
The Deputy Leader of the Opposition, Damon Bossino said:
“The Opposition agrees that the decision in relation to any new partner has to be well thought out and carefully analysed, however, it is of crucial importance to proceed with this diligently in order to ensure that the previous model, which has worked, continues to do so in the future. The last thing that Gibraltar would want is to forgo the benefits which come from private enterprise and outside input in one of Gibraltar’s areas of economic activity and allow such a venture to be continued to be owned wholly by the Government.”
