Argentine Government revokes postal service concession

The Argentine government has rescinded a concession to run the country’s post office, held since 1997 by a group led by tycoon Franco Macri, and set a 180-day period to re-privatize the service through a new tender.

The contract was rescinded by order of President Nestor Kirchner, officials said.

The decision comes in the wake of a lengthy showdown between Argentine authorities and the Macri group, with each side accusing the other of breach of contract.

Officials also announced a forthcoming probe into every aspect of how the postal service, known as Correo Argentina, was managed under Macri’s control.

Congressman Eduardo di Cola has been named interim manager, charged with launching a new bidding process that will return the company to the private sector within six months.

The Macri group holds 69.2% of Correo Argentina, with the rest belonging to Banco Galicia, 14%; the World Bank’s International Finance Corporation, 5%; and the service’s employees, who control 11.8% of the shares.

SOCMA, the conglomerate run by Macri, issued a statement – just hours before the Kirchner administration’s announcement – accusing the government of acting with “animosity and arbitrariness.”

In its communique, SOCMA noted that while “every other concessionaire and privatized firm has been able to open negotiations” with officials, “Correo Argentina hasn’t even been able to meet with the National Communications Commission, its logical regulatory body.”