Kok called for the government to reconsider

The Deutsche Bank consortium had offered 55bn crowns (�1.11bn) for the 51% stake owned by TelSource and the Czech government, but the government last Monday rejected the bid as too low.

Telsource, a consortium between Dutch operator KPN and Switzerland's Swisscom, owns 27% of Cesky.

Telecom, the most profitable telecoms group in eastern Europe, reported a net profit of 1.47bn crowns for the first quarter last Tuesday.

Valuable asset

It enjoys a near monopoly over voice, online and data services and owns 51% of Eurotel, a leading mobile phone operator.

The government said its decision not to sell Telecom does not threaten a 60bn crown deal to buy Gripen jet fighters from Sweden's Saab and Britain's BAE Systems.

The government had previously said it would finance the deal with the proceeds of privatisations, or through a bond issue.

"We will finance this project from a bridging loan until 2004, and I suppose that the government will carry out some large-scale privatisation project by that time," Finance Minister Jiri Rusnok was quoted as saying in the local press.