By Andrew Bushe
DUBLIN — All the country’s 2.8 million registered voters have received a mailing urging them to buy shares in the Telecom Eireann sell-off this summer, which Fine Gael’s Ivan Yeats has described as "risk free."
Enterprise Minister Mary O’Rourke said no decision had yet been made about how much of the company will be sold, what the share price will be and how the share offer will be divided between the public and financial institutions.
The company will be floated in Dublin, London and New York in late June or July.
O’Rourke said she will be recommending "a strong and generous" breakdown in favor of the public.
Ordinary people should get priority and the minister said she could envision Irish people sitting down in their kitchens and deciding to buy just a few hundred punts worth instead of going on a holiday.
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Yeats, himself a bookie, described the offer as a "sure bet" and wants ordinary people to get a guarantee of a minimum £3,000 worth of shares if they want them.
"The public are entitled to this," he said. "It is a public asset. We don’t want a situation where some broker in Manhattan wakes in July and finds he has made a cool million pounds.
"This is not a risky investment. This will be totally over-subscribed. I am telling people this is money for old rope."
The government will sell a minimum of 20 percent of the company in the summer, but it may dispose of 35 percent of it’s 51 percent stake.
Analysts are valuing the company, which is 20 percent owned by KPN/Telia, an alliance of the Dutch and Swedish phone companies, at about £5.5 billion.
KPN/Telia, who bought their stake in 1996, are expected to exercise an option to buy a further 15 percent from the government.
Employees will own 14.9 percent after the float.
The company’s last financial results for 1997-98 showed a profit before tax of £241 million on a turnover of £1.36 billion. Telecom has 11,000 employees and 204,148 phone connections.
O’Rourke described the sale as an "adventure." She launched an unusual £3 million public-awareness campaign aimed at the largest possible share take-up.
Under the plan, only people with Irish addresses can register for shares. Those registering in response to the mailing will get "priority" over normal applicants.
O’Rourke said the government would shortly consider how much of the company to sell.
"Twenty percent was just the figure put down for the purposes of having a minimum. I confidently expect it will be much more than that," she said.