Turkey reassures Çukurova shareholders in seizure wave

“It is without question that the TMSF will act delicately and without allowing harm to come to customers or other third parties,” read a Sunday press statement from Digiturk.

Turkey reassures Çukurova shareholders in seizure wave

Satellite provider Digiturk rushed to promise customers and shareholders on Sunday that there would be “no disruption in service” after the weekend seizure of the media company by Ankara's Savings Deposit Insurance Fund (TMSF), which also acquired nine other media subsidiaries of debt-stricken Çukurova Holding over the weekend.

“It is without question that the TMSF will act delicately and without allowing harm to come to customers or other third parties,” read a Sunday press statement from Digiturk. The TMSF, to which Çukurova Holding owed extensive debts, announced on Friday that it had requisitioned the bundle of companies including Digiturk -- Turkey's largest satellite television provider -- and signaled on Saturday that it might also move to acquire Çukurova Holding's shares in Turkcell if that company did not resolve an unrelated boardroom dispute.

The acquisition of Çukurova's 54 percent stake in Digiturk -- the remainder of the company is owned by Rhode Island-based Providence Equity Partners -- comes after what TMSF President Ercan Gül told the press on Friday were debts “the group had no way to pay.” Digiturk's debt woes first flared in mid 2011, when Çukurova owner Mehmet Emin Karamehmet faced a TL 500 million tax fine as punishment for Digiturk's unpaid bills to the state. Digiturk owns and produces more than 20 television and radio channels and owns the broadcasting rights for Turkish Football Federation's (TFF) Super League games.

The Capital Markets Board (SPK), Ankara's main corporate regulator, indicated on Saturday that Çukurova Holding may face further seizures if it doesn't resolve an ongoing crisis at Turkcell over the company's management board. Çukurova, which owns a 13 percent stake in Turkcell, is locked in a boardroom dispute over the company with 13.2 percent stake holder Altimo, which is owned by Russian Billionaire Mikhail Fridman's Alfa Group, and 38 percent stake holder TeliaSonera of Sweden.

Last week Turkcell cancelled a general assembly to elect new board members after both Altimo and Çukurova were unable to agree a representative for their joint shareholding.

On Saturday, SPK head Vahdettin Ertaş gave the company a 30-day ultimatum for holding a general assembly. “We cannot remain indifferent to Turkcell,” said Ertaş on Saturday. “Within this [30-day] period, have a meeting of the general assembly in accordance with business law and [Turkcell's] own founding contract, and choose new members to replace the old.” Ertaş said that if the company cannot reach an agreement, the SPK will install two independent board members to the company's leadership. In March, it appointed three independent board members during a similar dispute.

Çukurova's woes over Turkcell and Digiturk come after a decision earlier this month by the TMSF to seize vehicle manufacturer BMC and the broadcast channel Show TV from Çukurova Holding. It intends to auction off the requisitioned companies to pay off Çukurova's debt to the TMSF.

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Last Mod: 26 Mayıs 2013, 17:16
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