Turkey Wealth Fund completes Turk Telekom takeover

4 Apr 2022

Turkey Wealth Fund (TWF) has completed its purchase of a 55% controlling stake in Turkey’s dominant fixed network operator Turk Telekom (TT) from LYY Telekomunikasyon following the fulfilment of all requisite conditions and regulatory clearances, raising the sovereign fund’s total share in the telco to 61.68%. TWF highlighted that the takeover forms part of its mission to invest in domestic strategic industries, declaring: ‘With its firm commitment to public interest, TWF acts to contribute to the technological development and transformation in Turkey while benefitting from the long-term opportunities the sector offers within the context of its investment in Turk Telekom, one of the leading telecommunication companies in Turkey.’

Following negotiations with LYY – a Special Purpose Vehicle (SPV) formed by a group of 29 banks – which began in December 2021, the Share Purchase Agreement (SPA) signed on 10 March set the purchase price for the 55% TT stake at USD1.65 billion. The Turkish Treasury continues to hold a 25% TT stake plus special veto power, with the remainder in free float on the Borsa Istanbul (BIST).

According to TeleGeography’s GlobalComms Database, TWF-backed operators now dominate all Turkish telecoms sectors, as the state fund already owns a controlling stake in Turkcell – Turkey’s mobile market leader and second largest fixed broadband provider behind TT – as well as 100% of Turksat, the third-placed fixed broadband operator. TT’s cellular subsidiary TT Mobil competes very closely for the title of second largest mobile operator against Vodafone Turkey.

Turkey, TT Mobil (Turk Telekom), Turk Telekom