March 10, 2008 / 3:46 PM / 11 years ago

Iran to compensate Turkey's TAV - report

TEHRAN, March 10 (Reuters) - Iran has agreed to pay $5.7 million in compensation to Turkey’s TAV Airports Holding (TAVHL.IS) after its contract to operate Tehran’s new airport was scrapped in 2004, an Iranian news agency said on Monday.

Mehr news agency quoted an unnamed source as saying the cabinet approved a measure requiring the state airports body to pay the $5.7 million to TAV.

It was not immediately clear whether the amount was all or part of compensation claims by TAV. Iranian officials could not be contacted immediately to confirm the report.

TAV won an 11-year contract in 2003 to operate Terminal One of the city’s new international airport and build a second terminal there for about $200 million.

But the project fell through after Iranian hardliners opposed allowing a foreign firm to take such a key role. The airport was re-opened under Iranian management.

A TAV consortium poured $15 million into the airport but was unceremoniously thrown out on the eve of the first flights in 2004 by hardline Revolutionary Guards. (Writing by Firouz Sedarat; Editing by David Cowell)

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