Firms hit by forex challenge

Bloomberg

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The companies have a total of $26.4 billion of debt in foreign currency maturing in 2009 and may find it difficult to refinance it, Fitch said on its Web site yesterday. Corporate ratings may also come under pressure, it said.

"The Turkish corporate sector is facing significant challenges in refinancing outstanding foreign currency debts under the combined weight of poor global liquidity, international investor retrenchment from emerging markets, the impact of recession and a weakened lira," said Raymond Hill, head of emerging markets corporates at Fitch.

The Turkish Lira lost a quarter of its value against the U.S. dollar in the past six months, hurting the balance sheets of companies with debt in dollars and euros.

According to the report, companies with the most exposure to lira depreciation include Anadolu Efes Biracılık, Doğan Media Group, Coca-Cola İçecek, Hürriyet Gazetecilik and Vestel Elektronik.

Contraction in Turkey and in markets to which companies export their goods is "likely to push up leverage levels and pressure corporate ratings with respect to cash flow generation, leverage and refinancing risk," Hill said.