New OTE chief gets a wary welcome from markets
Greece’s OTE Telecoms had a new chief yesterday but investors remained fearful that the abrupt change of guard signaled government meddling, driving the company’s shares lower. OTE, Greece’s biggest company, changed leadership for the fourth time in as many years on Wednesday night after the State, still its largest shareholder, supported a former Shell executive to be the new board chairman and CEO. Lefteris Antonakopoulos succeeds Nikos Manassis, who was renominated and elected to the board but eased out of the top position by the government, which owns nearly 42 percent of the company. Analysts said Antonakopoulos’s lack of telecoms experience, apart from his five months on the OTE board, raised questions about why he had been tapped to lead the company as it girds to fend off growing competition at home and looks abroad to grow. «(Investors are) seeing a successful telecoms manager being replaced by a successful energy-experienced professional manager. There’s been no convincing reason why this change was needed and investors are seeing a political hand in all this,» said analyst George Pavlopoulos at Alpha Finance. Manassis was appointed to the top post in 2000 after successfully launching OTE’s mobile arm, CosmOTE. It was not clear why Manassis was dumped, but the government on Wednesday denied that it was meddling politically in the company that it has been slowly privatizing. That suggestion was dismissed again yesterday by Finance Minister Nikos Christodoulakis. «The management (of OTE) is elected by the general assembly,» he said flatly. Wednesday’s election was the first time shareholders had directly elected the board, rather than having them appointed by the government and came after Greece reduced its stake to below 50 percent. OTE, a heavyweight on the Athens bourse, saw its shares dip more than 2 percent yesterday, pressuring the broader market, before trimming its losses to 0.81 percent. In New York, OTE’s ADRs were unchanged at $7.49 at 2.42 p.m. local time. Analysts said a glut of concerns were keeping investors edgy apart from the abrupt government-engineered reshuffle, including questions about how long it would take Antonakopoulos to settle in to the new position. Privately, OTE officials shared the same concerns. «Now is not the best time to change. Next year would have been better. Whenever there’s a management change there are four months of doing nothing,» said one OTE subsidiary official. Schroder Salomon Smith Barney (SSSB) said in a report on March 13 that although investors might be reserved after the government’s move, nothing had fundamentally changed, with Antonakopoulos’s private sector experience making up for a lack of telecoms know-how. SSSB said investors would now be looking for specifics from the new team, including strategy for further growth. Antonakopoulos said he wanted OTE, which has interests in Serbia, Romania, Albania and Bulgaria, among other places, to look for growth abroad. «We view acquiring growth normally as a high-risk activity. Nevertheless OTE has the balance sheet strength to make investments and looking outside the Balkans could make sense to us,» said SSSB.
