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Iran begins state telecoms stake sale

TEHRAN - Iran started the sale of a five percent stake in its state-owned telecommunications company on Tehran's Stock Exchange on Saturday, as part of a wider plan to breathe life into its economy, the official news agency said.

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"From this morning the sale of five percent of the shares of Iran's telecommunications company started," Davoud Zareian, head of public relations at Iran Telecommunication Company (ITC), was reported as saying by the official IRNA news agency.

Iran is selling 2.293 billion shares in the company, IRNA said. The offer price had yet to be determined and would depend on demand for the stock, Iran state television reported earlier.

Past sales of state assets have drawn limited interest from the private sector. The sale of the minority stake in ITC 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 told Reuters on Saturday.

The Islamic state tried to shake up its lumbering economy in 2004 by overturning an article in the constitution which decreed 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 ITC offering has been delayed for months. ITC provides all of Iran's landlines. It competes in the mobile service sector with MTN Group MTNJ.J, sub-Saharan Africa's biggest mobile telephone operator.

Foreign investment in Iran has slowed as the United Nations has slapped three rounds of sanctions on Iran since 2006 for refusing to halt sensitive nuclear work which the West believes is aimed at building atomic bombs. Tehran says its nuclear activities are peaceful and aimed at generating electricity.