Turkcell shareholder Cukurova has asked the UK’s Privy Council for more time to pay co-investor Altimo the US$1.565bn plus interest needed to recover its shares in the mobile operator.
The Privy Council said in a statement that Cukurova, controlled by…
Turkcell shareholder Cukurova has asked the UK’s Privy Council for more time to pay co-investor Altimo the US$1.565bn plus interest needed to recover its shares in the mobile operator.
The Privy Council said in a statement that Cukurova, controlled by Turkish tycoon Mehmet Emin, has applied to extend the 60-day payment deadline until appeals pending before the US Court of Appeals for the Second Circuit have been resolved.
Cukurova has also asked the UK court for an order stating Altimo, part of Russian oligarch Mikhail Fridman’s Alfa Group, is not entitled to any interest from 9 July until the date these appeals are resolved.
The Privy Council decided on 9 July to allow Cukurova to recover shares giving control of Turkcell, which Altimo seized when the Turkish organisation defaulted upon loan obligations, on the condition that it pay the Russian company the US$1.565bn within 60 days, plus further interest accruing before the payment date.
The Privy Council is set to hear oral submissions on Cukurova’s requests next Tuesday (23 July).
CMB to soon appoint new board members
Meanwhile, Turkey’s Capital Markets Board (CMB) chairman Vahid Ertas has said the authority will soon appoint two more independent directors to the Turkcell board – a move which will give it a majority membership.
In an interview with CNBC-e.com, Ertas said the CMB will appoint the two new independent directors in addition to the three it appointed in March. Turkcell’s board has seven members in total, including the chairman. Ongoing disputes between Istanbul’s three major shareholders –Altimo, Cukurova and Sweden’s TeliaSonera – have prevented them from convening an AGM and agreeing upon the board’s composition themselves.
Altimo and TeliaSonera have both urged the CMB not to appoint new independent directors.
A spokesperson for Altimo told TelecomFinance today that the company is aware of the CMB’s plans to appoint the directors, noting that the Turkish parliament recently passed the relevant law that will allow it to do so. The law is currently awaiting the signature of President Abdullah Gul.
“Altimo urges the government not to rush with this kind of decision and await final resolution of the dispute within 60 days as decided by the Privy Council,” the spokesperson said.
TeliaSonera has also criticised the CMB’s plans, with CEO Per-Arne Blomquist telling the Financial Times last week that excluding shareholder-appointed directors from the Turkcell board would send a negative message to foreign investors.
Blomquist was also quoted as saying that any attempts to “nationalise” the Istanbul-based company by appointing a board made up solely of CMB-appointed directors would be contrary to both Turkish laws and international treaties.
However, Ertas has denied there are any plans to nationalise Turkcell.
Last week, he told the FT that new directors appointed by the CMB would remain in place only until Turkcell shareholders agreed replacements.
Turkcell’s trio of major shareholders have disputed the ownership and governance of the company, listed in Istanbul and New York, for several years. The CMB has repeatedly requested that Turkcell increase the number of independent directors on the board, but shareholders have repeatedly failed to do so. TeliaSonera has argued that attempts to increase the number of independent directors have been blocked by Cukurova via subsidiary Cukurova Telekom Holding. The Swedish telco has described the holding as a “structure put in place to enable a minority shareholder to block majority decisions”.
