WHITE & CASE IN MAMMOTH $3.3BN TURKISH FINANCING
WHITE & CASE IN MAMMOTH $3.3BN TURKISH FINANCING
Transaction Believed to be the Largest Amount of Debt Ever Raised by a Turkish Company
June 23, 2005
White & Case's Istanbul team is acting for Cukurova Holding A.S. ('Cukurova'), a major Turkish holding company, in a $3.3 billion financing deal with Alfa Group, one of Russia's largest privately owned financial and industrial conglomerates. In the two-part transaction, Alfa Group granted Cukurova a $1.707 billion six-year term loan, as well as purchasing $1.593 billion of convertible bonds issued by a Cukurova subsidiary, with a maturity date of 2011. The bonds can be converted 18 months after issuance and give Alfa Group the opportunity to take an indirect 13.22 per cent stake in Turkcell, Turkey's leading mobile telephony operator.
The transaction is subject to regulatory approvals and is expected to complete in the third quarter of 2005. Cukurova will use the sum raised to repay its debt to the Turkish State Deposit Insurance Fund and to repurchase the Turkcell shares held by Yapi ve Kredi Bankasi A.S., a Turkish bank in which Cukurova formerly held a controlling stake.
Turkcell is Turkey's only New York Stock Exchange quoted company (symbol: TKC), holds an approximate two-thirds share of the Turkish mobile telephony market and reported revenues of $3.2 billion for 2004.
The financing is the second major transaction that White & Case has advised Cukurova on in as many months, with the two deals totaling $4.71 billion: White & Case recently advised Cukurova in its sale of a controlling stake in Yapi ve Kredi Bankasi A.S. to Koc Financial Services A.S. for