GOVERNMENT, OTE DECLINES RUMORS ABOUT COMPLETING ARMENTEL SALE

Armenpress
Oct 12 2006

YEREVAN, OCTOBER 12, ARMENPRESS: Armenian government said yesterday it
was not notified by Hellenic Telecommunications Organization (OTE),
which owns 90 percent of shares in the national ArmenTel telephone
operator, about ArmenTel’s sale. Armenian transport and communication
minister Andranik Manukian said no official document was received
from Greece about the outcome of an international tender for ArmenTel.

OTE also denied rumors in the media that it has picked a tender winner
for its 90% stake in ArmenTel.

In a statement Wednesday, quoted by Prime-Tass, OTE said the tender
has not been yet completed and the company would make an official
announcement in due time.

On Monday an Armenian news agency and a Russian newspaper reported,
citing their unnamed source, that a consortium from the United Arab
Emirates (UAE) including telecom company Etisalat and investment fund
Istithmar, won the tender for the 90% stake in ArmenTel with an offer
of US$600 million. Etisalat has also denied these reports.

Besides Etisalat and Istithmar, Russian companies AFK Sistema and
VimpelCom have also bid for ArmenTel, as well as a consortium of VTEL
Holdings and Knightsbridge Associates, OTE said earlier.

ArmenTel has a monopoly on fixed-line and long-distance services in
Armenia. The company also had a monopoly on mobile services until
mid-2005.

ArmenTel’s fixed-line subscriber base stood at about 600,000 users
and its mobile subscriber base at about 330,000 users, as of mid
2006. Armenia’s population amounts to about 3.2 million people.