The Swedish company Telia Company (Telia) has signed a memorandum of understanding with Latvia, Latvenergo, and Latvian State Radio and Television Centre (LVRTC) regarding the sale of all of Telia’s shares in fixed network operator Tet and mobile operator LMT, according to a statement published on Telia’s official website.
The parties aim to sign a final agreement by the end of 2025, with the transaction expected to be completed in the first half of 2026.
“We are pleased to have reached a common understanding on the best way forward regarding these outstanding Latvian companies. We have agreed to proceed with the proposed transaction, in which our offer to sell our shares reflects the true market value of Tet and LMT. The complex ownership structure of Tet and LMT has slowed down value creation. This memorandum is a turning point for both us and Tet and LMT, who will now be able to grow under a new ownership model that benefits customers and all stakeholders,” said Telia President and CEO Patrik Hofbauer in the statement.
According to Latvenergo press secretary Ivita Bidere, a press conference will take place on Friday, the 18th of July, at 12:00 at the Latvenergo headquarters to provide more details about the memorandum signed between Latvenergo, LVRTC, and Telia.
Latvenergo reports that the Cabinet of Ministers has endorsed the initiative by Latvenergo and LVRTC to approach Telia regarding the possible acquisition of its shares in Tet and LMT.
The press briefing will be held at Latvenergo’s building in Riga, Pulkveža Brieža Street 12, with Latvenergo CEO Mārtiņš Čakste, LVRTC Chairman Ģirts Ozols, and Telia’s M&A Director Andreas Ekström in attendance.
Previously, discussions with Telia regarding the future of LMT and Tet were led by representatives of the Ministry of Economics. Now,
the offer to repurchase the shares is being made by state-owned Latvenergo and LVRTC.
Unofficial sources had earlier estimated the value of the deal to range from several hundred million euros to up to half a billion euros.
In past negotiations between Latvia and Telia, several scenarios were considered — from merging Tet and LMT to maintaining the status quo. Options also included full or partial buyout of the companies or separating specific assets.
Over the years, a complicated ownership structure for Tet and LMT was created, which until now had prevented the state and Telia from reaching an agreement on restructuring.
Currently, the Latvian state, through SIA Possessor (Public Asset Manager), owns 51% of Tet, while Telia’s subsidiary Tilts Communications owns the remaining 49%. In LMT, 49% is held by Telia and its subsidiary Sonera Holding, 28% by the Latvian state through LVRTC and Possessor (5%), and the remaining 23% by Tet.
This theoretically gives Telia a 60.3% stake in LMT via Tet, and Latvia a 39.7% stake. In practice, however, the state exercises decisive control over LMT due to its majority stake in Tet. Nevertheless,
this structure has hindered several strategic decisions that require unanimity.
Telia previously proposed a scenario in which both main shareholders — the state and Telia — would each hold 50% of LMT, after LMT acquired Tet’s telecom business. An initial public offering (IPO) of 20% or more of LMT shares was also proposed, with both shareholders selling part of their shares in the IPO.
Latvian officials did not officially comment on this proposal but dismissed the possibility of selling the state’s stake.
LVRTC had previously expressed readiness to financially participate in buying out Tet or its optical network infrastructure. This option was supported by LMT President Juris Binde, who suggested LMT could acquire Tet’s customer portfolio. Meanwhile, Tet CEO Uldis Tatarčuks had stated that Tet could consider buying a stake in LMT.
It was also unofficially suggested that Latvenergo might be the vehicle through which the deal would proceed, as the government was not prepared to use state budget funds for the buyout of LMT and Tet.
The post Memorandum signed on sale of Telia-owned shares in Tet and LMT to Latvia appeared first on Baltic News Network.
