Athens - Greece said Wednesday it struck a deal to sell a three per cent equity stake in the country's telecom company, OTE, to Germany's Deutsche Telekom for over 442 million euros.

Greek Finance Minister Giorgos Alogoskoufis said Deutsche Telekom would pay 29.75 euros per share for a three per cent stake in the Hellenic Telecommunications Organisation or OTE.

"The Greek government will receive 442.3 (US$682.9 million)," Alogoskoufis said.

Under the deal, which was agreed upon after months of negotiations, the Greek government and Deutsche Telekom would each control 25 per cent plus one share of OTE, while the German operator could also raise its holdings of the Greek company in the future.

Each party will control five seats on OTE's 10-seat board and Deutsche Telekom will name the CEO, with the Greek government allowed the right to veto up to two candidates.

"The deal ensures that there is a balanced share ownership and a balanced board of directors," said Alogoskoufis, adding that Deutsche Telekom will not be able to fire employees or sell shares without government approval until the end of 2011.

Alogoskoufis said that a partnership with Europe's largest telecoms organisation will strenghten OTE, both financially and technologically. The deal also open's the door for Deutsche Telekom in central and eastern Europe markets, offering access to unattainable markets such as Romania and Bulgaria.

The deal will go into effect once it is approved by Greece's 300- seat parliament, where the ruling conservatives have a slim one seat majority.

Deutsche Telekom announced in March the acquisition of a 20 per cent stake in OTE for 2.5 billion euros from Marfin Investment Group Holdings SA.

The government immediately came under fire by opposition leaders and labour unions following the announcement, with workers planning walkouts on Thursday.

The ruling conservative government is planning to sell off stakes in a number of state-run companies in order to lower the country's public debt, including the main commercial ports. (dpa)