ISTANBUL |
ISTANBUL Feb 23 (Reuters) – Turkish Prime Minister Tayyip Erdogan said on Saturday the government may hold an initial public offering of the nation’s major highways and bridges after it canceled an initial $ 5.7 billion tender because it found the price too low.
The High Privatisation Council, chaired by Erdogan, on Friday scrapped the tender, won in December by a consortium made up of Koc Holding, Turkey’s largest company, local partner Gozde Girisim and Malaysia’s UEM Group Berhad.
“Because we found the figure low, we cancelled this tender,” Erdogan said at a news conference. “There are different kinds of privatisations. It doesn’t have to be a block sale. Work is being carried out (including) on a public offering. We could take a step that would offer to the public a certain share.”
Officials complained the bid was too low when annual revenue was taken into account. At the time of the tender, the state highway agency said the bridges and roads raised 740 million lira ($ 412.4 million) in the first 11 months of 2012.
The package of eight roads and two bridges, including the Edirne-Istanbul-Ankara motorway and the Bosphorus and Fatih Sultan Mehmet bridges linking Europe and Asia, were offered as a single package for a period of 25 years at the tender.
The sale had not been finalised and remained in state hands.
The sale had given a boost to Turkey’s flagging privatisation programme, constrained by high valuations and tough funding conditions due to the euro zone crisis. Several sales of state assets have been postponed.
As a result, the government failed to meet its 2012 budget target of 12.5 billion lira in privatisation receipts, adding to pressure on public finances. ($ 1 = 1.79 Turkish liras) (Reporting by Ayla Jean Yackley; editing by Gunna Dickson)
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Turkish PM says may hold IPO after cancelling highway tender
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