Telekom Slovenije (TS) has announced it will hold a shareholder meeting on 7 March to discuss a Deloitte report which contends that its mishandling of investment-related transactions in the Balkans incurs damages estimated at about €7m …
Telekom Slovenije (TS) has announced it will hold a shareholder meeting on 7 March to discuss a Deloitte report which contends that its mishandling of investment-related transactions in the Balkans incurs damages estimated at about €7m (US$9.2m).
The report is based on a recent audit by Deloitte.
The state-owned telecommunications operator notified the Ljubljana Stock Exchange that its supervisory board had already discussed the Deloitte report– which examines transactions in the Republic of Macedonia, Kosovo, Bosnia-Herzegovina and Slovenia between 2006 and 2011 – and has added it to its general meeting agenda in March.
The report by Deloitte’s Slovenian unit states TS failed to follow good corporate practices when carrying out numerous transactions concerning sales and purchases, the establishment of new companies and loans.
It states TS’ 2009 purchase of Macedonia’s On.net for €185.6m, for example, was carried out in an insufficiently transparent manner.
“Similar to TS’s purchases of other companies in Slovenia and abroad, there is evidence of a lack of actual control in the purchase of the majority participating interest in On.net,” it added.
For various other reasons, however, Deloitte determined this particular transaction did not incur damages.
However, the firm estimated TS’ 2007 purchase of a 75% stake in Kosovo’s Ipko, incurred damages of at least €3.86m as at 31 December 2011, while the group’s subsequent sale of the stake to Factor Banka (FB) incurred estimated damages of €8.39m.
The report also highlighted issues with loans and related activities, stating “there are clear indications that the TS Group did not establish an appropriate system of control over cash flows within the group during the period observed, in accordance with best business practices”.
Neither TS nor Deloitte’s Ljubljana unit were immediately available for comment.
