ArmInfo.The Government of Armenia accepted a 20% stake in the MTS Armenia company as a gift and transferred the authority to manage it to the office of the Prime Minister of the Republic of Armenia. The decision was approved on February 29 at a meeting of the Cabinet.
As Pashinyan's chief of staff, Arayik Harutyunyan, stated when presenting the draft decision, the Fedilco Group Limited company is the 100 percent owner of 550,000 shares of MTS Armenia CJSC with a nominal value of 1,000 drams. "At the general meeting of the company on February 16, 2024, it was decided to transfer 110,000 shares to the Republic of Armenia, which is equivalent to 20% of the 100% shares of "MTS Armenia" CJSC," he said.
In turn, the Armenian authorities, taking into account the strategic importance of MTS Armenia CJSC for the telecommunications sector of the Republic of Armenia, the strategic goals of the government in this area, as well as the current state of the IT sector, decided to accept these shares as a gift. "The Government of the Republic of Armenia accepts the gift with gratitude and is pleased to note that the people of Armenia, represented by the Cabinet of Ministers, have the opportunity to ensure their presence and participation in a company of strategic importance for the republic," Prime Minister Nikol Pashinyan said.
At the same time, according to him, this is not the only possible format for public participation in business management. The prime minister offers companies to list their shares on the stock exchange. "By accepting this gift, the government wants to convey a message to other companies - not that they need to donate their shares to the government, but that they should pursue a policy of transformation into an open joint stock company, which will mean 100% transparency in their work," he said. As the Prime Minister indicated, the government will most likely introduce a differentiated tax approach in relation to OJSC and CJSC.
According to him, there has been and will be a lot of speculation on the topic of transferring shares of a number of companies to the RA government. "I don't think there are countries that allow a foreign investor to acquire 100% of the shares of a telecommunications company, and at the same time the government remains a passive observer and has no idea what is happening there. In any civilized country such an approach is excluded," Pashinyan noted.
In turn, Armenian Finance Minister Vahe Hovhannisyan noted that the government is working on a concept for state participation in private companies. The document will identify sectors of strategic importance, where state participation in the management of companies will be considered a priority. Earlier, on January 24, MTS announced the closing of a deal to sell 100% of the shares of MTS Armenia CJSC, its subsidiary in the Republic of Armenia, (Viva-MTS brand, serves 2.3 million subscribers) to the Cypriot Fedilco Group Limited. The transaction also included MobiDram CJSC, a payment system providing financial services in the Armenian market, a 100% subsidiary of MTS Armenia.
Before the deal, MTS Armenia owned by Aramayo Investments Limited, which, in turn, through the Luxembourg Allegretto Holding was 100% owned by MTS. According to media reports, the beneficiaries of Fedilco Group Limited are Zhe Jang and Konstantin Sokolov. The Armenian Regulator approved the sale of 100% of the shares of MTS Armenia to the Cypriot Fedilco Group Limited from Aramayo Investments Limited in November 2023. A similar application by Fedilco was rejected by the Commission in April 2023 because it "threatened the national security or state interests of the Republic of Armenia."
