Middle East firms target Telsim

Seven firms, including four from the Middle East, submitted bids last week in the US$3 billion contest to buy Turkish mobile operator, Telsim.

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By  Tamara Walid Published  December 11, 2005

Seven firms, including four from the Middle East, submitted bids last week in the US$3 billion contest to buy Turkish mobile operator, Telsim. According to Turkish media reports, the bidders include British firm Vodafone; the UAE’s Etisalat; Egypt’s Orascom Telecom; Russia’s Sistema; MTC of Kuwait; Germany’s Endeks; and Dubai-based International Investment and Telecommunications. Telsim, which is Turkey’s second largest mobile operator and has over nine million customers, has been valued by the Turkish authorities at US$2.8 billion. It is being sold to pay off debts run up by the company’s former owner, the Uzan family, which had its assets seized last year by the government. A bid deadline has been set for December 5, with Turkey’s Saving Deposits Insurance (TMSF) fund saying it will open bids publicly on December 13. The seven represent half of the firms that originally pre-qualified for the auction. France Telecom dropped out in late November, while Norwegian group Telenor withdrew last week. The sale is seen as a lucrative opportunity for foreign companies to gain a foothold in Turkey’s telecommunications market, while Turkey sees it as a chance to attract foreign investment and develop its telecommunications infrastructure. It confiscated the assets of the Uzan family after the collapse of the group’s Imar Bank in 2003, which left the government with debts of over US$6 billion. Arguments over the US$3.4 billion Telsim owes to equipment suppliers Motorola and Nokia have also held up the sale. Earlier this year, the government offloaded a majority stake in Turk Telecom, the country’s leading telecoms operator, to a group headed by Saudi firm, Oger Telecom. Meanwhile, Naguib Sawiris, the Egyptian investor who heads Oracom Telecom and bought the Italian telecommunications company Wind earlier this year, said last week that he was willing to pay about US$1.6 billion for TIM Hellas Telecommunications of Greece as part of his expansion drive into Europe.

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