TeliaSonera said today it has won a year-long legal dispute with Cukurova in relation to a broken agreement to sell a stake in Turkcell to the Swedish incumbent.
The International Chamber of Commerce (ICC) ordered Cukurova to pay damages of US$932m plus…
TeliaSonera said today it has won a year-long legal dispute with Cukurova in relation to a broken agreement to sell a stake in Turkcell to the Swedish incumbent.
The International Chamber of Commerce (ICC) ordered Cukurova to pay damages of US$932m plus interest to the Swedish telco.
The arbitration case goes back to March 2005, when the two companies announced that Cukurova had agreed to sell all its remaining shares in Turkcell to TeliaSonera for US$3.1bn.
Cukurova later withdrew from the agreement, which would have given TeliaSonera a majority stake in Turkcell. As a consequence of Cukurova’s withdrawal TeliaSonera commenced arbitration proceedings in May 2005.
According to TeliaSonera, today’s ruling by the arbitration tribunal is final. The US$932m amount awarded will bear interest from 30 June 2007 until full payment by Cukurova, at the highest rate paid by the Turkish State Banks for one year term deposit accounts in USD.
Cecilia Edstrom, senior vice president and head of TeliaSonera communications, said that the company “will take immediate action to recover damages in countries where Cukurova has assets”.
The arbitration tribunal has earlier issued partial awards, TeliaSonera noted. The first award was issued in January 2007, stating that a binding share purchase agreement between TeliaSonera and Cukurova was concluded and ordering Cukurova to close the transaction.
In a second partial award, issued in July 2009, the arbitration tribunal further stated that Cukurova must deliver all the remaining shares in Turkcell Holding to TeliaSonera for a cash consideration of US$3.1bn.
Following Cukurova’s failure to comply with either of those rulings, TeliaSonera requested the tribunal to award damages.