Turkish state fund approves sale of armoured vehicle maker BMC

ISTANBUL Thu May 8, 2014 6:21am EDT

ISTANBUL May 8 (Reuters) - Turkey on Thursday approved the 751 million lira ($360 million) sale of armoured vehicle maker BMC, seized from troubled conglomerate Cukurova Holding a year ago, to a businessman close to the government.

The Savings Deposit Insurance Fund (TMSF) said it would approve the sale of BMC to Es Mali Yatirim & Danismanlik, a company owned by Ethem Sancak, who also owns the pro-government Aksam newspaper.

The TMSF had initially estimated BMC's value at 958 million lira but postponed an auction for the company last month as it held out for the best possible bid.

Sancak was the only bidder at a new auction held last week.

The TMSF seized BMC, along with 11 other group companies, from Cukurova last May, alleging that the conglomerate failed to make payment on $455 million worth of debts owing to the fund.

Cukurova is also in dispute with shareholders in Turkcell , Turkey's biggest mobile phone operator, over its 13.8 percent share in the firm, a controlling stake due to its complex ownership structure.

Russia's Altimo, an arm of tycoon Mikhail Fridman's Alfa Group, appropriated the stake when Cukurova defaulted on a $1.35 billion loan.

Cukurova has been ordered to pay around $1.6 billion to Altimo to recover the stake, although the deadline for the payment has repeatedly been postponed.

A U.S. appeals court last month threw out a ruling that froze the assets of Cukurova, clearing the way for it to try to buy back the Turkcell stake.

($1 = 2.0819 Turkish Liras) (Reporting by Evren Balllim; writing by Ece Toksabay; editing by Nick Tattersall and Jason Neely)