Aas proposed selling all 100,000, or 100 percent of, shares of AS Eesti Teed belonging to the state with a nominal value of €100. The item was opened for discussion and approved as presented by Aas, spokespeople for the government said on Thursday.

As the privatization of the road maintenance market had not produced an effective competitive environment by 2012, the state deemed it necessary to acquire full ownership of AS Eesti Teed in order to provide road maintenance service financed from the state budget, spokespeople said.

Since November 2017, AS Eesti Teed has been acting on market terms and conducting road maintenance work under contracts concluded on the free market.

Competition has improved in the maintenance market, and procurements for state road maintenance services have received on average five bids since the beginning of 2017. As a result, retaining the state's holding in AS Eesti Teed is no longer justified, Aas' proposal reads.

The ministry proposal seeks to hold the public auction in October, on the condition that the government approves the sale and grants the minister managing the holding authorization to begin the relevant procedures by June 1 at the latest.

The sale of the company should be conducted in a way that is most beneficial to the state, the proposal reads. Thus, the ministry proposes selling the state's holding at a public auction for at least €14 million, the book value of the assets, which exceeds the market value provided by an expert last November.

According to an analysis and fair value estimate on Eesti Teed commissioned from KPMG, the company's value as of October 2018 was between €9.2-12.9 million, and its base value €10.5 million.

The copany's equity was valued between €14-17.6 million, and its base value €15.3 million.

The analysis of and proposals for the privatization of AS Eesti Teed have been included as an objective in the government's 100-day plan.

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