November 5, 2018 / 1:17 PM / 12 days ago

Austria eyes fast-track top-ups of its company stakes

VIENNA, Nov 5 (Reuters) - The Austrian government’s planned overhaul of the body through which it holds stakes in several large companies will open the door to topping up those holdings more easily, Finance Minister Hartwig Loeger said on Monday.

Austria’s holdings include a 31.5 percent stake in oil company OMV, a 52.9 percent stake in Austrian Post and a 28.4 percent stake in Telekom Austria.

Under a bill being submitted to parliament, the right-wing government intends to replace Austria’s current holding company, Austrian Federal and Industrial Holdings (OBIB), with a new organisation called Austrian Holdings AG (OBAG) on Jan. 1.

OBAG would have greater freedom to buy stakes in companies without needing formal approval by the whole government, though it would still need the finance minister’s approval, and how those purchases would be paid for remains to be seen, Loeger told reporters.

Asked what type of companies OBAG would be able to invest in, Loeger said: “Existing stakes are clearly in focus.”

He declined to say which companies Austria might increase its stakes in, but added that an investment committee of people with experience in international asset management would be formed to advise OBAG on its decisions. The company’s board would also be chosen by mid-February, his ministry said.

The government’s 51 percent stake in utility Verbund would officially remain in the Finance Ministry’s hands rather than OBAG’s but it would be managed by the holding company, the Finance Ministry said.

In total OBAG would manage roughly 23 billion euros ($26 billion) in assets, most of which belong to the federal real estate management agency, which OBAG would take over, the ministry added.

More generally, the government plans to use the company to take a more active role in managing company stakes, including by taking more positions on supervisory boards and where possible those boards’ chairmanships.

“With this reform OBAG has the opportunity to carry out more active management of holdings. That means putting increasing company value and competitiveness in the foreground,” he said, adding that securing locations in Austria was also a goal.

The government is not, however, planning to carry out any privatisations, Loeger said, repeating the position of the ruling coalition that was formed last December.

$1 = 0.8793 euros Reporting by Francois Murphy; Editing by Jan Harvey

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