ECONOMY

TeliaSonera’s bid for Turkcell stumbles on popular opposition

STOCKHOLM/ISTANBUL (Reuters) – Nordic telecom group TeliaSonera failed to seal a $3.1 billion deal for control of top Turkish mobile firm Turkcell yesterday, suffering a blow to its expansion plans as it faces tough competition at home. The seller, troubled conglomerate Cukurova, refused to sign off on a deal to sell a 27 percent stake in Turkcell to bring TeliaSonera’s holding to 64 percent, saying it was responding to popular demand to keep the firm Turkish. TeliaSonera said it planned legal action to get the deal done. Analysts said Cukurova might be eyeing a higher bid after Russian Alfa group expressed its interest in March. «We have been ready to sign for a long time, but Cukurova doesn’t want to. They are refusing. We now need to clearly make a stand,» TeliaSonera Chief Executive Anders Igel told Reuters. The Finnish-Swedish firm, seeking growth beyond saturated home markets, said Cukurova must complete the sale. «TeliaSonera will pursue legal actions to protect its rights,» it said. Igel said TeliaSonera had the right to match rival bids. Cukurova said it was acting in response to calls by the general public and at Turkcell’s general meeting on April 29, even though about 99.5 percent of Turkcell shareholders at the general meeting had approved the sale to TeliaSonera, which would leave Cukurova with 13.5 percent. «In the light of requests to keep a prestigious company like Turkcell under the control of a Turkish company… Cukurova Group will start work on options that will not result in a change of control of Turkcell,» it said in a statement. The conglomerate, looking to offload most of its Turkcell stake under a debt-restructuring plan with banking regulators, said the «general public» was against a request from TeliaSonera for an exemption from buying out minority shareholders. TeliaSonera spokesman Michael Kongstad dismissed the idea of any anti-foreign feeling surrounding the deal. «Nothing has really happened since our deal a couple of months ago. We still want to have local partners and still want the company to be listed in Turkey,» he told Reuters. Illustrating Telia’s competitive woes, Norwegian Telenor said it was buying two firms in fast-growing broadband markets, one Danish and one in the core Telia market of Sweden. Some analysts said the deal was likely to go through anyway. Others said Cukurova was trying to win more money from Telia.