The Icelandic Treasury has received ISK66.7bn (€0.8bn) in cash for the sale of Iceland Telco to a group of local investors.

The big pile of cold hard moolah is the highest one time payment that the treasury has ever received, according to the Icelandic National Broadcasting Service (RÚV). The ISK34.5bn was paid in Icelandic króna and ISK32.2bn in foreign exchange.

The government intends to pay back most of its foreign loans, purchase a vessel and an airplane for the coast guard, put money into housing for the mentally ill and invest in transportation infrastructure projects and the construction of a "high tech hospital", which will begin in 2008. A communication fund will receive ISK2.5bn to build up the GSM system in rural areas.

An earlier attempt to sell off the company was scrapped over a conflict of interest between the CEO and some of the potential buyers. The CEO was fired.®