In the press conference held by binali Yildirim, the Minister of Communication, he gave information on privatization strategy of Turk Telekom. Minister Yildirim noted that priorly a block transaction will be experienced for the privatization of Turk Telekom and then its shares will be offered to public as a secondary privatization.
The cabinet had adopted a principle resolution on Turk Telekom’s privatization strategy. This way the cabinet has approved the strategy regarding the privatization of Turk Telekom as a pre-requisition for the last tranche from IMF. Approval of Turk Telekom privatization strategy was expected before the IMF predicted to be held in November.
Minister Yildirim noted that block transaction for the sale of 51 percent or a greater percentage of the corporation is their priority in Turk Telekom’s privatization strategy. Yildirim stated that Turk Telekom will be put on tender by the end of May 2004, the latest for its privatization and the sale process will be determined by the tender commission. Yildirim emphasized that they will make a point of assigning 5 percent of shares to employees as a requirement of the law.
Yildirim stated that there will be no discriminiation between foreigner or native partner during the process of privatization, “The tender will be public. It was not possible to sell more than 45 percent of shares to foreigner partners. For this privatization we will implement, that will become possible. Shares will be sold to either foreigner or Turkish or syndicates formed by those” he said.
Minister Yildirim noted that appraisal and tender commissions have been established by Ministry of Communication, Undersecretary of Treasury and Head of Privatization Administration in order to fix the worth of Turk Telekom. Yildirim noted that once the block transaction is successfully made, then they will implement privatization by offering shares to public as a second step.
TÜRK TELEKOM’S BALANCE SHEET
Minister Yildirim also mentioned Turk Telekom financial data of 2003, first 9 months.
2003 Gross Profit 2,3 Quadrillion
2002 Gross Profit 1,2 Quadrillion
2003 VAT 1,82 Quadrillion
2002 VAT 773 Quadrillion
2003 Resource for Public 2,85 Quadrillion
2002 Resource for Public 2,1 Quadrillion
Saying that Turk Telekom achieved an increase of 32,5 percent for revenue per subscriber and 76 percent for profitability, Minister Yildirim number of employees has reduced by 400 people during last year, whereas 295 new staff has been employed during the last period of 9 months. Minister Yildirim said Turk Telekom has 61 thousand 190 employees.
Yildirim said 60 thousand ports of ADSL will start to be used by the end of this year, the latest and 200 thousand more ports will be added in the year 2004. Stating that ADSL will bring high speed Internet access as well as a significant reducing in access fees, Yildirim added that a tender for a second fiber optical cable system has been commenced. Yildirim stated that as this project will be completed, external Internet access capacity will increase 500 times and reach a level of nearly 1.2 terabit, which is 2 gigabit by now.
“GOLD SHARE PRACTICE WILL CONTINUE”
In respect of gold share practice, Minister Yildirim said:
“For now, practice of gold share will continue during the privatization process. We are not considering to remove it. Gold share will continue in respect of issues such as strategy and security. This practice was experienced in previous privatizations as well. We don’t think that gold share practice will expose a retracting effect.”
As he responded reporters’ questions, the question “Is there a B plan in case that block transaction fails?” has been answered by Minister Yildirim:
“We will try first. After that, of course we have some alternative studies. Our present agenda is experiencing the privatization to make a block transaction covering 51 or a greater percent of shares by the end of May. After that offering shares to public will be in our agenda. We cannot mention any number by now.
During the tender process of block transaction, the price fixed by appraisal commission will be mentioned in technical documents prior to the date of receiving offers. Studies for it has been completed mainly.”
SATELLITE SERVICES GET SEPARATED
Yildirim said satellite services are planned to be separated during the privatization of Turk Telekom, and necessary legal regulation will be made for this purpose.
Noting that wireless Internet will be provided at airports, hotels and universities, Yildirim added that:
“Wireless Internet is a system practiced at public places, airports, hotels and universities. This are structures allowing broadband access without needing wire. We made the first experience mounting two of them during the opening of parliament. This will be spread to all public places in course of time.