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38 I Southeast Europe bne July 2020
BEYOND THE BOSPHORUS:
Erdogan becomes top shareholder in Turkcell
Akin Nazli in Belgrade
Turkey Wealth Fund (TWF) confirmed on June 18 that it is to take over Swedish Telia’s 24.02% indirect stake in largest Turkish mobile operator Turkcell for $530mn in cash. Analysts saw the price as low.
The sovereign wealth fund will finance the deal through “state mandate and a loan from LetterOne”, Telia said.
Only $150mn will be provided by TWF, with the remainder secured in the form of an interim loan from LetterOne, which will later be cancelled out as LetterOne increases its stake. LetterOne has a one-year lock-up on Turkcell shares.
All parties agreed to forsake existing legal cases related to the telco at the international arbitration courts.
“The price is less than 50% of market cap which is low,” analysts at Norway’s
www.bne.eu
Den Norske Bank (DNB) were quoted by Reuters as saying in a note.
Telia will write in a capital loss of Swedish crowns (SEK) 3bn ($322mn) from the sale.
Questions for Stockholm
Erik Meyersson of Sweden’s Handelsbanken questioned aspects
of Telia’s involvement in Turkcell on Twitter, given that Telia is partly owned by the Swedish government.
He posed some questions: “1) How
did a partly SE-state-owned co get so deeply embroiled in TR’s authoritarian decline? 2) How much was SE gov involved in Telia’s dealings w TR state re TCELL? 3) What did SE gov do to
try to stop TCELL being used as an instrument of repression? 4) What were the net benefits to Swedish taxpayers of Telia’s TCELL investment? To the extent that the costs include failure to uphold
human rights values abroad, what were financial gains?”
It might be said that the main problem here is that most people see the ethical side of business as some kind of exotic, romantic thing that comes along as a bonus, if it’s doable and you’re lucky
– but that’s short to medium term thinking, those who overlook ethical values always lose out in the long run.
The Swedish government is not the first to think it was smart to overlook Turkish President Recep Tayyip Erdogan’s crimes against humanity and the list of those who meet the same end that it has with the Turkcell investment will only keep expanding until the last victim emerges licking their wounds.
Meyersson also shared a blog post that he wrote in 2014, entitled “Turkey’s Economic Miracle and its Swedish Cheerleaders”.
"Hey Donald, getta load of this." Erdogan's now ruling the roost at Turkcell.