Iran Prepares to Lure Foreign Investors After Nuclear Deal – by Thomas Erdbrink (New York Times – August 21, 2015)

Sadjad Ghoroghi, for one, who runs a mining company in Zanjan in northwestern
Iran, says he had long dreamed of finding a foreign investor willing to help
expand his operations. Iran is thought to have rich deposits of zinc, copper
and gold, and experts say that mining has the potential to become a $60 billion
industry, equal in size to the country’s oil industry.(Thomas Erdbrink)

ZARRINABAD, Iran — When Iran’s Revolutionary Guards Corps took over the nation’s telecommunications monopoly in 2009, the move was denounced as another dark step in the hard-line military group’s seizure of the levers of power.

“It’s not just a matter of the Guards dominating the economy, but of controlling the state,” Alireza Nader, an expert on Iran and the co-author of a comprehensive RAND Corporation report on the Revolutionary Guards, said at the time.

Last month, however, the company, the Telecommunication Company of Iran, was put up for sale, as the Revolutionary Guards now seem more interested in cashing in on what Iranian leaders are hoping will be a flood of foreign investment if a nuclear deal with world powers gains final approval and sanctions are lifted.

And it is not just the Revolutionary Guards. During the past decade, well-connected Iranian investors amassed undervalued assets in poorly executed and frequently corrupt rounds of privatization, buying insurance companies, hospitals, refineries and public utilities, among other things previously run — usually poorly — by the state.

But with Western sanctions putting an ever-tightening stranglehold on the Iranian economy, finding buyers for the assets became next to impossible, especially in recent years. In the absence of outside investors, and no deep-pocketed private buyers in the country, Iranian investment companies fronting for state pension funds, military cooperatives and religious foundations bounced shares back and forth on the Tehran Stock Exchange just to make small profits.

“They had no one to sell to inside Iran but now, with the nuclear deal done, everything is falling into place,” said one well-established Iranian-American consultant who asked to remain anonymous because his business activities are punishable under United States law as long as sanctions remain in place. “A lot of people here have started pulling out their calculators.”

The potential sell-off began to take shape in July, as the nuclear agreement began to move toward a conclusion, economists say. That was when the Etemad-e-Mobin investment company, part of a cooperative fund belonging to the Revolutionary Guards Corps, put the Telecommunication Company of Iran on the selling block.

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