11 June 2009

Merrill Lynch Downgrades OTE To Neutral

11 06 2009 - Merrill Lynch downgrades the OTE (Hellenic Telecom. Org) stock from buy to neutral, in a report dated 11 June 2009.

The Bank says that since the previous upgrade several developments have occurred which are now in the price.

It indicates that the old voluntary redundancy scheme is expected to be completed by next September while it highlights that OTE has started negotiations with unions, following election of union representatives since a restructuring plan for additional 2,000 employees is still pending.

Cosmofon was sold for €190m to Telekom Slovenije in March 2009 DT and OTE both gave on the synergies from integrating the businesses  saying it now had identified an annual run-rate of €257m of costs that could be taken out from the business, the report continues.

The bank also says that the 2009 EBITDA will be 3% down compared to previous estimates, while it places EBITDA for 2010 at a higher level, mainly due to synergies stemming from the agreement with DT.


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