ECONOMY

Telsim hits back at Motorola with an ad

CHICAGO (Reuters) – Turkey’s No. 2 wireless operator, Telsim, on Friday lashed out in a global advertising blitz against wireless technology giant Motorola Inc., which has sued the company’s owners for fraud. Telsim took out full-page advertisements in several newspapers in the United States, Europe and Asia, asking shareholders to question whether Motorola’s management was acting in their best interest. «We ask you… to hold your management accountable for their continued pursuit of an uncertain and lengthy legal strategy aimed to divert shareholder attention when a clear and mutually beneficial resolution – arbitration – is available,» the ad said. Owned by the Uzans, one of Turkey’s wealthiest families, Telsim placed the ads in the US, Asian and European editions of the Wall Street Journal, the New York Times, the International Herald Tribune and the Washington Times, ahead of Motorola’s annual shareholder meeting next Monday. Motorola spokesman Scott Wyman called the ads «the latest example of the continuing fraudulent behavior being perpetrated against Motorola and its shareholders.» In January 2002, Motorola and Finland’s Nokia sued several members of the Uzans, alleging they borrowed almost $3 billion from the companies with no intention of repaying the loans. In their lawsuit, the companies alleged fraud under US anti- racketeering laws and sought repayment plus damages. The Uzans have argued that the dispute, which they describe as a commercial disagreement, belongs in a Swiss arbitration court as mandated by the contracts between the companies. The company also said in its ad that it had offered to repay the loan on a revised schedule. «At no time has Telsim indicated that it would walk away from its debt to Motorola,» it said in the ad. The loans date back to 1998, when the industry routinely loaned money to customers for equipment purchases in a practice known as vendor financing. The district court case was heard in February, but was not attended by the Uzans or their attorneys, who have argued the court does not have jurisdiction in this case. Last month, a US district court judge in New York, acting on an appeals court decision, dismissed Motorola’s racketeering claims against the Uzans, but left open the possibility they could be reinstated. Motorola last year wrote off the $2 billion loan it made to Telsim. Nokia has written off its $700 million loan. Meanwhile, members of Motorola’s senior management have been the target of several shareholder lawsuits, alleging they did not properly disclose vendor financing commitments involving Telsim.