Russia’s Alfa Telecom says it is ready to sell Turkcell stake for $2.7 billion

ISTANBUL - Reuters

Russia’s Alfa Telecom said on March 25 it was ready to sell a 13.22 percent indirect stake in Turkcell to Turkey’s Çukurova and Ziraat Bank for a total of around $2.7 billion, according to a statement to the Istanbul stock exchange.

The announcement is the latest twist in a dispute over control of Turkey’s top mobile operator which stretches back almost a decade, a tussle that has prevented some dividends from being paid and hampered the company’s development.

Alfa, part of Russian billionaire Mikhail Fridman’s business empire, has been locked in a legal battle with equity partner Çukurova, run by Turkcell’s founder Mehmet Emin Karamehmet.

Alfa said on March 25 it was willing to sell 49 class-A shares in Çukurova Telecom Holdings Limited for $54.9 million per share, equivalent to 13.22 percent of Turkcell.

Two years ago, an international arbitrator ordered Alfa to return a separate 13.8 percent stake to Çukurova for $1.6 billion. Strapped for cash, Çukurova financed the purchase with a loan from state-owned Turkish lender Ziraat Bank, which it has yet to repay.

Two sources close to the dispute said the court battle was expected to be concluded in the coming weeks and that Alfa’s announcement appeared to be a strategic move, by putting pressure on Çukurova to either find the funds to buy the additional stake and gain control or concede defeat.

Officials from Alfa and Çukurova in Turkey could not immediately be reached for comment.