By Atom MarkarianA Lebanese firm that was selected as Armenia’s second mobile phone operator without a competitive bidding earlier this month will pay only $7 million for the lucrative license, it emerged on Thursday.
Details of the deal hastily approved by the Armenian government on November 4 were posted on the government’s web site. It reveals that the telecom firm called K-Telecom will transfer $5 million of the sum to the state budget within the next four years.
K-Telecom will also contribute $2 million to the All-Armenian Hayastan Fund, a Diaspora-funded private charity that sponsors infrastructure projects in Armenia and Nagorno-Karabakh. The government did not specify why it decided to divert part of the modest payment to Hayastan.
The deal also calls for the operator’s Lebanese owners to invest an additional $10 million in Nagorno-Karabakh’s telephone network which they have run since 2001. However, it envisages no investment commitments for their future wireless network in Armenia. Officials at the Armenian Ministry of Transport and Communications say K-Telecom has given a non-binding pledge to invest $50 million.
The government has still not provided a clear explanation for its decision to grant the license to K-Telecom. Officials admit that it was the sole bidder in a “tender” called and administered by the government in less than two hours.
The move came one day after Prime Minister Andranik Markarian’s cabinet approved a compromise agreement that settled its long-running dispute with ArmenTel, Armenia’s dominant telecom operator owned by Greece’s OTE giant. Under the terms of the agreement, ArmenTel will lose its legal monopoly on mobile telephony in return for several government concessions.
However, ArmenTel appears to have delayed their official approval of the deal which seemed a mere formality when it was made public. The company’s board was meeting in Athens on Thursday to discuss the issue.
Justice Minister David Harutiunian, who negotiated the settlement with OTE executives, said he is confident that the Greeks will agree to formalize it.