The Serbian Ministry of Finance working group for the privatization of 51% of shares in national telecommunications provider Telekom Serbia has extended the deadline for submitting binding bids until March 31.
According to the Ministry, the deadline was pushed so that France Telecom and Deutsche Telekom, as well as all other interested companies, will have enough time to study the tender documents and make the best quality bids for the privatization of one part of Telekom Serbia.
The Finance Ministry announced that the deadline was extended in order to give more time to France Telecom, Deutsche Telekom and other participants to study the tender documents.
The Serbian government set on December 24, 2010 a minimum starting price to US$1.86 billion.
The government instructed the Finance Ministry and its working group to notify all participants in the Telekom privatization tender about the starting price.
The tender for the sale of Telekom was called on October 20, 2010 and the initial deadline for placing binding offers was February 21. The government will schedule a public auction after the deadline has expired.
Serbia’s Ministry of Finance has announced that seven companies have applied to participate in a tender for the 51% stake in Telekom Srbija being sold by the government.
The seven companies include Deutsche Telekom, France Telecom, Telekom Austria, America Movil, Weather Investments, Turkcell and VimpelCom. According to a statement from the ministry, the seven qualify to participate in the tender and have been given the green light to take part in the next step in the process, which will be to submit a guarantee of payment in order to view Telekom’s sale documentation.
According to State Secretary of Finance Vuk Djokovic, the seven companies will be required to submit binding offers no later than 21 February 2011. If there are several offers, a tender auction will be organized at the end of February.
He stated that the winner will be the company that offers the highest price. The winning firm will have to then obtain the approval of the anti-monopoly commission in Serbia, as well as in Bosnia-Herzegovina and Montenegro where Telekom Srbija has subsidiaries. Djokovic expressed the hope that the entire process could be completed by the end of the first half of 2011.
Motorola Inc. (NYSE: MOT) chairman and CEO Edward J. Zander said yesterday that his company had made extensive investments in R&D in Israel. It’s always exciting to come back to Israel. We have production activity in Israel, and we have commercial opportunities here for equipment sales. We will be happy to continue investing here, however, for a global company, the challenge is to find the right R&D investment opportunities, and the right time and place to make them, provided that the governments in question undertake to create the right conditions to promote such investment,??? he said.
Zander was speaking yesterday during a brief visit to Israel, in which he also hinted that Motorola would expect significant government support for its planned expansion of activity through the opening of an R&D center in the Jordan Valley.
We don’t have R&D activity solely in the US and Israel. I have just visited some of our centers in China, Russia, Italy, France, the UK and India, and all these locations have opportunities. Investment in people is a gamble; our investment in China or Russia, where we never actually had any activity before, is phenomenal. As long as Israel creates brilliant people and the government works with us on relevant incentives, we’ll be here,??? he added.
Expressing his disappointment at the pace of progress in cellular television technology, Zander said, I thought that we would see more activity in DVB-H this year, but I haven’t noticed any. Broadcasting costs are still high, and the content has still not yet been adapted to the new medium. I don’t want to see full-length movie on a handset, but short clips on sport, news and so forth, and we still don’t have this. The concept calls for the creation of a form of video clip sampling and this has not been created yet.???
As regards Iden technology, which is used by, among others, Motorola subsidiary MIRS Communications Ltd., and which is in danger of becoming obsolete, Zander said, Iden is still an interesting technology, and anyone who uses it falls in love with it. This is the only technology that offers genuine walkie-talkie, and it has loyal customers in the US, as well as being a great success in South America. We realize that companies want dual-function handsets that also support an additional network, and we are still looking for a way to continue expanding the Iden market.???
Motorola also invests in star-ups at fairly early stages, to ensure its exposure to new technologies, and reach early agreement on their commercial use. The company has so far invested in $400 million in 70 companies worldwide, eight of them in Israel. Zander did not disclose the amount that Motorola has earmarked for future investment, although it is clearly looking for companies with interesting technologies in telecommunications and other overlapping fields in Israel.
Zander told participants at a reception on Saturday night at the David Intercontinental Hotel in Tel Aviv that, some time ago, Motorola Israel CEO Elisha Yanay told him that he would like to introduce him to a few close friends during his visit to Israel. I found out yesterday afternoon, that Elisha has 500 close friends,??? Zander said, to the amusement of his audience. He said that he was proud that Motorola was the first US company to invest in Israel back in 1964, stressing that, business in Israel was one of the most important worldwide,??? growing from an initial investment of $12 million to $1.2 billion with 3,500 employees, producing 40% of total industrial output in Israel. All the output is derived from local R&D and half is exported.
Zander has avoided making any public comments on Motorola’s planned $50 million investment in an R&D center in the Jordan Valley, which will hire at least 400 engineers within a few years. He opted instead to discuss it behind closed doors in meetings with Minister of Industry, Trade and Labor Eli Yishai, and Vice Premier Shimon Peres. Government sources nevertheless claim that the investment is a done deal, even if Motorola prefers not to announce it publicly.
Shortly after their private meeting, Peres told the audience at the David Intercontinental Hotel, Motorola was the first US company to invest in Arad in the Negev region, and it is now about to invest in the Galilee, despite the recent war.???
Informed sources believe that the reason for Motorola’s official silence is that it intends to make use not only of tax benefits for foreign investors but also the employee salary subsidies available under the Law for the Encouragement of Capital Investments (1959). The company will still have qualify for this through a tender process (competitive allocation”, which will entitle the company to a monthly NIS 2,000 credit on salaries of NIS 22-25,000 for five years). Under the Law for the Encouragement of Capital Investment Motorola will first have to win an employment tender, which Investment Promotion Center director Hezi Zaieg will publish soon, before it can qualify for the salary credits.
The sources believe that Motorola fears that if it officially announces the establishment of the center now, opponents might file for injunctions against it in the High Court of Justice, alleging that the competitive allocation had been tailored upfront for Motorola.
Meanwhile, Motorola’s plans for the center on the ground are well under way. They have been endorsed by Ministry of Finance officials, and preliminary agreement has been reached with the Investment Promotion Center, which is contingent on Motorola meeting the terms of the competitive allocation arrangement (one of which will it require it to keep the R&D center operating for 10 years).
The Ministry of Finance, Investment Promotion Center, the local council and Vice Premier Peres all feel that the opening of Motorola’s R&D center in northern Israel, with hundreds of jobs for engineers and researchers, will have a significant effect on the region, especially considering that every engineering position will create an average addition of two local service jobs.