Alfa Group applies for indirect control of Turkcell

9 Sep 2015

Russian-backed Alfa Group has applied to Turkey’s Competition Authority (RK) to take indirect control of Turkish mobile operator Turkcell from Cukurova Holding, reports Hurriyet Daily News, citing a statement from RK, in a move which continues a long-run feud between Alfa and Cukurova for ownership of the company.

An unnamed source is said to have informed Reuters that the battling companies have been in discussions regarding the matter: ‘This latest move must be a tactical or formal application. Alfa made an offer to Cukurova last March … Cukurova said the [offer could not be evaluated] as it has applied to an international arbitrator in London.’ However, the same source disclosed that in order to take control of the Turkish cellco, Alfa also needs to acquire permissions from public authorities, including the RK, the market watchdog (SPK) and the communication board (BTK). Arbitration sessions are now expected to take place next spring.

As at August 2015 Turkcell’s shareholder structure was reported as follows: Turkcell Holding owns a 51.00% stake, TeliaSonera owns 14.02%, Cukurova Holding owns 0.05%, and the remaining 34.93% of shares are publicly traded on the New York Stock Exchange (NYSE) and the Istanbul Menkul Kiymetler Borsasi (IMKB). Turkcell Holding is itself owned by TeliaSonera (47.09%, giving it a 37.09% overall stake in Turkcell) and Cukurova Holding (52.91%, for a 26.98% overall interest). Cukurova Holding is majority controlled by the Turkish Cukurova Group (51%, or a 13.76% overall stake in Turkcell), with 18.5% held by Alfa Group (4.99% overall stake in Turkcell).

As previously reported by CommsUpdate, in March 2015 Alfa reportedly bid USD2.8 billion for the disputed 13.76% Turkcell stake. Alfa offered USD54.9 million per share for 51 of Turkcell’s Class B shares, which were being held by state-run Ziraat Bank as collateral for a loan to Cukurova. TeleGeography notes that the USD2.8 billion bid represents a significant premium on the USD1.56 billion price previously attached to the stake.

Turkey, Altimo (part of the Alfa Group), Turkcell