PM Kulbergs criticizes minister Valainis over delayed LMT and Tet merger, millions already spent
Prime Minister Andris Kulbergs expressed frustration that Economy Minister Viktors Valainis failed to deliver a solution by July 31 for buying out Telia's stakes in LMT and Tet and merging the companies, even though several million euros have already been spent on the project.
Latvia's Prime Minister Andris Kulbergs told reporters on Wednesday that Economy Minister Viktors Valainis and the Economy Ministry had failed to present a solution for buying out Swedish telecom company Telia's shares in mobile operator LMT and telecom company Tet and merging the two firms, despite a July 31 deadline.
According to Kulbergs, 13.6 million euros have already been spent on the project with no tangible result. He said the process had become overly complicated, involving tenders and the creation of holding structures, without a clear government mandate for further action.
Strategic investor still not found
The State Chancellery noted that the government tasked the ministry back on June 10, 2025, with selecting an experienced international strategic investor in the telecom sector through an open and transparent process. No such investor has been secured. Non-binding investor offers were due by the end of July, but none have been received. The Economy Ministry's proposed deal structure — under which the state, Latvenergo, LVRTC and a financial investor would each hold roughly 25% — does not match the government's original mandate, since a financial investor is not the same as a strategic industry partner.
The memorandum of understanding with Telia expired on July 31 and was not extended, meaning the deal cannot proceed under its current structure. Nearly 4.5 million euros had been spent on consultants for the LMT-Tet merger process by August 31, and total costs could reach 13.6 million euros if the project continued through year-end. An additional 80,000 euros was spent searching for a chairman of the board for the merged company, without success.
Kulbergs calls for a simpler approach
The prime minister is urging an immediate halt to consultant contracts and direct negotiations with LMT and Tet themselves, starting with the companies buying out Telia's stakes on their own, then merging, and afterward bringing in a strategic partner from among leading telecom firms. Kulbergs stressed that the merger remains important but should no longer require additional borrowed funds. He has instructed the State Chancellery to review what has happened so far and prevent further wasteful spending, adding that the next government must find a straightforward solution.
The state currently holds 51% of Tet through the Possessor state asset manager, with Telia's subsidiary holding the remaining 49%. In LMT, Telia's group holds 49%, while the rest is split between LVRTC, Tet, and Possessor.
