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REFILE-UPDATE 1-Turkey may act on Turkcell if row drags on - Babacan/TV
May 23, 2013 / 9:46 AM / 5 years ago

REFILE-UPDATE 1-Turkey may act on Turkcell if row drags on - Babacan/TV

(Refiled to remove editing marks at start of headline)

ISTANBUL, May 23 (Reuters) - Turkey said on Thursday it may intervene to resolve an impasse paralysing mobile phone company Turkcell, which has been unable to agree the make-up of its management board or pay dividends due to a dispute between major shareholders.

In an interview with Turkish broadcaster Bloomberg HT, Deputy Prime Minister Ali Babacan said the government would prefer the shareholders to agree among themselves but that the capital markets board could take steps if they failed to do so.

Turkcell cancelled its general meeting on Wednesday because Russia’s Altimo and Turkey’s Cukurova were unable to agree a representative for their joint shareholding, leaving the company unable to approve 2010-2012 financial accounts.

“We will not allow Turkcell to be without a management board,” Babacan said. “If they don’t (resolve the issue) the state will certainly intervene until the partners agree”.

Turkcell shares were down 1.28 percent at 11.55 lira on Thursday, having dropped more than 2 percent a day earlier.

Altimo, the telecoms arm of Russian billionaire Mikhail Fridman’s Alfa Group has a 13.2 percent stake in Turkcell, while Nordic telecoms company TeliaSonera is the biggest shareholder with 38 percent.

The row centres on Istanbul-based Cukurova Holding’s disputed 13.8 percent stake in Turkcell, which is a controlling stake due to the structure of its shareholders. Altimo and Cukurova share ownership of the holding company behind the listed Turkcell business.

Altimo seized the stake from Cukurova after the latter defaulted on a $1.7 billion loan eight years ago.

Britain’s Privy Council court ruled in January that Cukurova could recover its stake if it repays Alfa, including interest, but the holding is also struggling with other debts which led to Turkey’s Savings Deposit Insurance Fund (TMSF) seizing control of 45 Cukurova-owned companies last week. (Reporting by Can Sezer; Writing by Daren Butler; Editing by Nick Tattersall and Sophie Walker)

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