The Armenian government has offered its stake in Armentel to VimpelCom, which has already closed a deal to buy the other 90% from Greek telecom group Hellenic Telecommunications Organization SA (OTE) for 341.9 million euros ($434.5 million), Communications Minister Andranik Manukyan said.

VimpelCom, which outpaced the Russian mobile market leader MTS at the tender to buy 40% of the Armenian cellular telecommunications market, undertakes to pay the Armenian company's liabilities of about 40 million euros ($51 million).

The deal is to be closed by the end of 2006, VimpelCom said in a news release.

Hellenic Telecommunications Organization SA (OTE) purchased Armentel in 1997 for $142.5 million and has since invested $300 million in the company, whose earnings in 2005 stood at 110 million euros ($140 million).

Armentel has about 600,000 fixed-line and 400,000 mobile service subscribers, and operates in the GSM 900 and CDMA standards. RIA Novosti