Regulator says it has control in mobile row

ISTANBUL - Reuters

Çukurova’s Mehmet Emin Karamehmet is at odds with Russia’s Altimo.

Turkey’s telecoms watchdog said on Tuesday it would have to approve any change in control of Turkcell, the country’s biggest mobile phone operator, a day ahead of a British court ruling which could leave the firm with no major Turkish shareholder.

The Privy Council is set to rule today in the long-running shareholder dispute between Turkish businessman Mehmet Emin Karamehmet and Altimo, the telecoms arm of Russian billionaire Mikhail Fridman’s Alfa Group.

Should it rule in Altimo’s favour, the Russian company could be awarded Karamehmet’s 13.8 percent stake in Turkcell, which also carries controlling rights through its complex management structure, stripping Turkcell of a major Turkish stakeholder. “In the royalty contact signed between our institution and Turkcell, it says any kind of share transfer resulting in a change of control requires an approval from our institution,” Turkish telecoms watchdog BTK said in a statement.

The Privy Council, the highest court of appeal for many Commonwealth countries, is hearing the case because Karamehmet holds his stake in Turkcell through his Cukurova holding company, registered in the British Virgin Islands.

The telecoms watchdog said any ruling by the British court would not alter the fact that a share transfer would need its blessing but gave no hint as to what it would do if Çukurova was stripped of its stake. The dispute centers around a loan taken in 2005 by Çukurova from Altimo, which indirectly holds 13.2 percent of Turkcell.