Macedonia regulator approves sale of Telekom Slovenia unit to Austrian peer

LJUBLJANA/SKOPJE, July 8 (Reuters) - Macedonia's market regulator said on Wednesday it had approved the sale of Telekom Slovenia's Macedonian unit to Telekom Austria (Other OTC: TKAGY - news) , a move that could pave the way for completing the privatisation of the Slovenian parent.

Talks on the sale of state-owned Telekom Slovenia to British-based investment firm Cinven collapsed in June after Cinven said it would not pay the full price until the regulator approved the sale of Telekom's Macedonian unit.

The regulator said the Macedonian unit could be sold to Telekom Austria as agreed by the two companies last year. The deal brings together Macedonia's second and third biggest mobile operators, the regulator said.

Telekom Austria will hold 55 percent of the merged venture and run the operation, while Telekom Slovenia would hold the remainder, with options to exit the venture within three years.

Cinven declined comment. Slovenian state firm SDH, which is coordinating the sale of Telekom Slovenia, said it could not immediately say if the talks would continue now that the sale of the Macedonian unit had been cleared.

Telekom, with a market capitalisation of 575 million euros, is the largest of 15 companies that Slovenia earmarked for privatisation in 2015. So far five of those firms have been sold. (Reporting By Marja Novak in Ljubljana and Maja Zuvela in Skopje; Editing by Zoran Radosavljevic and Susan Fenton)