Deutsche Telecom (DT) has decided not to purchase a 51% stake in Polska Telefonia Cyfrowa (PTC) because Elektrim failed to come to terms with PTC's bondholders, DT announced on Friday.

The company said that that currently it holds a 49% stake in PTC and will do its best to ensure PTC's further expansion.

Rumors are circulating that Elektrim was desperately searching a way to overcome bondholders' obstinacy. It wanted to renegotiate the contract with DT and demand EUR 100 million more from DT than previously envisaged, which would eventually give the Polish company EUR 500 million after it had paid its various debts.

According to Andrzej Kasperek from BM Bank Handlowy, the failure of the negotiations is very bad news for Elektrim.

"The price of EUR 1.1 billion was not a too attractive price, but it was still good enough for Elektrim which is indebted up to its neck" he said.

(WBJ 29.ix.03)