Tehran begins sale of telecom firm's stake

Iran started the sale of a five per cent stake in its state-owned telecommunications company on Tehran's Stock Exchange yesterday, as part of a wider plan to breathe life into its economy.

Iran is selling 2.293 billion shares of its Telecommunication Company of Iran (TCI) and the shares were valued at 1,500 Iranian rials each, stock exchange board member Hashem Boozarjoomehr said. That would value the offered stake in the company at just over $340 million.

It was not clear whether all of the shares were sold yesterday.

Past sales of state assets have drawn limited interest from the private sector. The sale of the minority stake in TCI leaves state control intact, giving no mandate for the kind of restructuring private investors would like to see, analysts say.

"The sale of these shares is a symbolic act and not real privatisation," analyst Saeed Leylaz said.

Iran tried to shake up its lumbering economy in 2004 by overturning an article in the constitution which decreed that core infrastructure should remain state-run.

Iran has been seeking to sell off many state firms, though not in the upstream oil and gas industry. Progress has been slow.

The TCI offering has been delayed for months. TCI provides all of Iran's landlines. It competes in the mobile service sector with MTN Group, sub-Saharan Africa's biggest mobile telephone operator.

Boozarjoomehr also said foreigners could buy TCI shares through brokers but were required to keep their capital in Iran for three years.