UPDATE 1-Yildiz unit confirms Turkish telecoms financing talks

Fri Jun 13, 2014 6:00am EDT

(Adds comments from Gozde CEO)

ISTANBUL, June 13 (Reuters) - Gozde Girisim, the listed private equity unit of Turkish conglomerate Yildiz Holding, is in talks on a "structured financing" concerning the country's telecoms industry but is not planning to partner in the business, its chief executive said on Friday.

Cem Karakas did not say why the firm was seeking funds, but it is widely expected to provide another conglomerate, Cukurova Holding, with financing to recover its disputed stake in the country's biggest mobile phone operator Turkcell .

Three sources close to the matter said earlier this week that Cukurova would receive financing from a local partner, and two of the sources said Cukurova would obtain it from Yildiz.

"Gozde is in talks on structured financing for the telecoms sector, but we don't have plans at present to invest and become a partner in the telecoms sector," Karakas told Reuters. The firm declined to say what it meant by a "structured" financing.

Gozde's shares fell 2.75 percent to 3.18 lira. Ulker, Turkey's biggest foodmaker which is also owned by Yildiz, declined 2.23 percent to 17.55 lira, while Turkcell's shares were 0.7 percent higher at 13.60 lira.

Cukurova and Altimo, the telecoms investment arm of Russian billionaire Mikhail Fridman's Alfa Group, have been fighting for seven years over control of Turkcell, choking decision-making at the firm and preventing the payment of dividends.

At the same time Swedish company TeliaSonera, which owns an effective 37 percent of Turkcell, has been embroiled in a separate but related dispute with Cukurova concerning a claim for damages after the Turkish company reneged on an earlier deal to sell TeliaSonera part of its stake in Turkcell.

The Turkish government sees Turkcell as an asset vital to national interests and wants control to remain in Turkish hands and has been pushing for a local corporate partner to help Cukurova raise the $1.6 billion it was ordered by the judicial body of the UK's Privy Council last July to pay Alfa to recover its stake, the sources said earlier this week.

Cukurova said earlier this week it was in talks to arrange financing to pay Alfa.

Cukurova's owner is Mehmet Emin Karamehmet, Turkey's 13th richest person, according to Forbes magazine, which estimates his wealth at $1.5 billion, while Yildiz's chairman Murat Ulker is ranked as the country's richest person with $3.7 billion. (Reporting by Asli Kandemir and Seda Sezer; Writing by Ayla Jean Yackley; Editing by Nick Tattersall and Greg Mahlich)