The Competition Board on December 16, 2010 cancelled the sale of the İstanbul Bosphorus Electricity Distribution Company to İş-Kaya İnşaat Sanayi ve Ticaret Ltd. Sti.-MMEKA Makine İthalat Pazarlama ve Ticaret A.Ş. Joint Venture Group for $1.225 billion on procedural grounds. The İstanbul Bosphorus Electricity Distribution Company provides power to the European side of Turkey’s largest City and has 3.8 million subscribers. İş Kaya MMEKA is a joint venture between businessman Mehmet Kazancı and Mehmet Karamehmet. The board cited Kazancı’s former association with rival Aksa Doğalgaz, which also bid in the tender. Aksa is owned by his brother, Cemil Kazancı, and other family members. The board said it viewed the two groups as a single entity and noted that awarding of the contract would give the Kazancı brothers an unfair domination over the Turkish electricity power distribution. It said that İş Kaya MMEKA would have to forfeit either the Bosphorus Electricity tender or the tenders of the AYADAŞ (İstanbul Asian side) Electricity Distribution Company or the Gediz Electricity Distribution Company, to prevent it from gaining a dominant share in the power distribution of Turkey. The other participants in the tender were: Park Holding Cengiz Elektrik Toptan Satış A.Ş., Kolin İnşaat Turizm Sanayi ve Ticaret A.Ş., Limak İnşaat Sanayi ve Ticaret A.Ş., Enerjisa Elektrik Dağıtım A.Ş., Eti Gümüş A.Ş. & Soğutsen Seramik Sanayi İnşaat Madencilik İthalat Ihracat A.Ş. Joint Venture Group, KCETAS-AYEN Joint Venture Group and IC İçtaş İnşaat Sanayi ve Ticaret A.Ş.
A consortium of four companies won the consultancy services in the privatization of the assets of state power producer and Elektrik Üretim A.Ş. (EUAŞ) The consortium includes Citi Group, Oyak Yatırım, Master Danışmanlık and SOCOIN. EUAŞ operates hydroelectric dams and power plants and controls around 50% of electric power production capacity in the country with 24,194 MW. In 2008, the company took a spectacular loss of $392 million on net sales of $5.820 billion. EUAŞ employs 9,965 persons.
The Competition Board on December 16, 2010 cancelled the sale of the Gediz Electricity Distribution Company to İş-Kaya İnşaat Sanayi ve Ticaret Ltd. Sti.- MMEKA Makine İthalat Pazarlama ve Ticaret A.Ş. Joint Venture Group (İş Kaya MMEKA) on procedural grounds. The group in August 2010 won the privatization tender with a $1.920 billion bid. Gediz distributes power in Izmir and Manisa provinces in western Anatolia and has 2.3 million subscribers. Is-Kaya MMEKA is a joint venture between businessman Mehmet Kazancı and Mehmet Karamehmet. The board cited Kazancı’s former association with rival Aksa Doğalgaz, which also bid in the tender. Aksa is owned by his brother, Cemil Kazancı, and other family members. It said that awarding of the contract would give the Kazancı brothers an unfair domination over the Turkish electricity power distribution. It said that Is Kaya MMEKA would have to forfit either the Gediz tender or the tenders of the Bosphorus Electricity Distribution Company or the AYADAŞ (İstanbul Asian side) Electricity Distribution Company to prevent it from gaining a dominant share in the power distribution of Turkey. The other companies that submitted offers included: Enerjisa, Park Holding A.Ş., Cengiz Elektrik Toptan Satış A.Ş., Kolin İnşaat Turizm Sanayi ve Ticaret A.Ş., Limak İnşaat Sanayi ve Ticaret A.Ş., Eti Gümüş A.Ş.&Soğutsen Seramik Sanayi İnşaat Madencilik İthalat İhracat A.Ş. Joint Venture Group, KCETAS-AYEN-REL-PETCO Joint Venture, IC İctaş İnşaat Sanayi ve Ticaret A.Ş.
The Competition Board on December 16, 2010, cancelled the sale of Trakya Electricity Distribution Company to Aksa Elektrik Perakende Satış A.Ş. on procedural grounds. Aksa had won the tender in August 2010 won the tender with a $622 million bid. Trakya supplies electricity to the provinces of Edirne, Kırklareli and Tekirdag in European Turkey and has 800,000 subscribers. Aksa is owned by his Cemil Kazancı and members of the Kazancı family. Kazancı’s brother, Mehmet Kazancı is a major shareholder of MEKA- MMEKA, a group that also bid for the power distribution company. The board cited the ties and said it viewed the two companies as one entity. It said the awarding of the distribution company would give the Kazancı brothers an unfair dominant control over the Turkish power distribution sector. IC İctaş or KCETAŞ-Ayen Joint Venture Group will lilely be awarded the tender.. The other bidders were: Park Holding A.Ş., Cengiz Elektrik Toptan Satış A.Ş., Kolin İnşaat Turizm Sanayi ve Ticaret A.Ş., Limak İnşaat Sanayi ve Ticaret A.Ş. Eti Gümüş A.Ş.& Söğütsen Seramik Sanayi İnşaat Madencilik İthalat İhracat A.Ş. Joint Venture, and Palmet Enerji A.Ş.
The ÖİB said on April 7, 2011 that it had completed the tender for the privatization of Sumer Holding’s Mazidağ Phosphate Mine, in Mardin province in southeastern Turkey, and endorsed the sales to one of six companies that bid for it. It said the approval of the Privatization Higher Council and the Competition Board would be needed before the sales of the mine can be concluded. Details on the tender were unavailable. But one of the strongest bidders was believed to be fertilizer producer Gübretaş. The mine, which hasn’t been functioning during the past few years, has an annual capacity to produce 250,000 tons of phosphate concentrate.
EFG İstanbul Menkul Değerler A.Ş.- Mag Engineering Services-İsmen Law Bureau Consortium was selected as the consultant of Privatization Administration (ÖİB) for the sale of Salıpazarı Port (formerly known as Galataport), as the government moved forward in 2011 in its intention to privatize the renewal and operations of İstanbul’s old passenger liner gateway. The government wants to transfer the operational rights of the port, rather than privatize it, on a Build-Operate-Transfer (BOT) scheme. The other groups that bid for the consultancy services were: Société Générale-Artı Consultancy-Özel&Özel Law Offices Consortium; TSKB-Delitte-Belde Proje Consultancy Services-Esin Law Offices Consortium, and İş Investment- 2ER Consultancy-Yüksel Küçük Law Firm Consortium. The ÖİB cancelled the first tender in February 2006 after the State Planning Organization refused to approve the transfer of shares of Galataport to a consortium led by Israeli businessman Sammy Ofer’s Royal Caribbean Cruises and Turkey’s Global Investment Holding, because of irregularities in the tender. The consortium on September 19, 2005, won the bidding for the rehabilitation and operations of the Galataport for 49 years with a $4.3 billion (€3.538 billion) offer. Other members of the consortium included Rouse Tri-party, an American operator of shopping centers; Sasso Holding, a Monaco-based Israeli investment company; IC Belek Tourism, a tourism development company and member of İbrahim Çeçen Investment Holding, a Turkish contractors group; Limak, a Turkish construction company. Sammy Ofer was reportedly interested in bidding in the new tender. The new port will help transform Karaköy (Pera), a former 15th Century Venetian neighborhood with rundown, crowded, old apartment buildings, shabby business offices, deçaying port facilities, mosques, churches and synagogues, into the “new Barcelona” of İstanbul, in a major urban renewal. Some 5,000 historic buildings in the district will be renovated, and İstanbul’s public brothels, located in Karaköy, will be moved outside the city. Salıpazarı Port, located between headquarters of the Turkish Maritime Organization (TDİ) in Karaköy, next to the ferryboat landings, and Chamber of Maritime Commerce in Fındıklı, would include three hotels, restaurants, cinemas, convention centers, new customs facilities, cultural centers, playgrounds, a shopping center, a museum and a large automobile park, and a new quay.
A consortium composed of Citigroup Global Markets, EFG İstanbul Securities and Ak Securities won the consultancy services from the İstanbul Municipality for the privatization of İstanbul Gas Distribution Company (İGDAŞ), which in 2008 had a net income of $11.4 million on net sales of $1.719 billion. İstanbul Mayor Kadir Topbaş said İGDAŞ would be sold in a public offering.
Gür-Tem Madencilik Turizm ve Ticaret A.Ş. in October 2010 was the highest bidder for the Treasury’s İstanbul Maltepe Properties with a TL 127 million ($88.8 million) offer.
The Privatization Administration (ÖİB) in May and June 2010 completed the tenders for 52 small river hydroelectric power plants (HEPPs), with the winners offering a total $449 million for the management rights for 49 years. The HEPPs, which are owned by the state Electricity Production Company (EUAŞ), are being sold in 19 groups of one to five power plants each, pending approval of the tender results from competition authorities and the Council of State, Turkey’s supreme administrative. Most of the HEPPs are old – at least 30 years old -- and have completed their economic lifespan, requiring extensive dredging and new investments. The government doesn’t want to carry out the investments, preferring to sell the sites to the private sector. The 51.2 MW Kovada II in Isparta province and the 14.4MW Cağ Cağ in Mardin province are the biggest hydroelectric power plants on sale. About 60% of the HEPPS have under 1 MW power capacity. The tender for the Group 12 Koyuluhisar, Büyükkızoğlu HEPPS in Sivas and Samsun provinces will be held at a later date. Below are the current status of the 18 tenders, of which several acquisitions have been completed.
Kent Solar Elektrik in January 2011 acquired the management rights for 49 years of the Group One HEPPS -- the Dereköy HEPP in İznik, the Cerrah HEPP in Inegöl and the Suuçtu HEPP in Mustafakemalpaşa in Bursa province – for $6.6 million.
Sarar Giyim Tekstil Sanayi Ticaret A.Ş. was the highest bidder for the Haranlı in Hendek, the Pazarköy in Akyazı and the Bozhöyük HEPPs in Bilecik and Sakarya provinces. The power plants are part of the Group Two HEPPs.
Nema Kimya -Espe was the highest bidder for the Kayaköy HEPP in Kütahya province in western Anatolia with a $17.411 million offer. Kayaköy represents the sole dam in Group Three.
Aksu Enerji was the highest bidder for the 8.25 MW Kovada 1 and the 51.2 MW Kovada II HEPPs in İsparta province, with a $56 million offer. The two power plants represent the only HEPPs in Group Four.
Fides Reklam Enerji Hizmet Logistic Turizm Sanayi. Ticaret. A.Ş. was the highest bidder for the Turunçova-Finike HEPP in Antalya province with a $2.760 million offer. The Turunçova -Finike represents the sole power plant in Group Five.
Seba Joint Venture Group was the highest bidder for the Bozyazı in the Anamur, the Derinçay (in Mut), and the Zeynel and the Silifke HEPPs in Mersin province with a $13.5 million offer. The two power plants represent the HEPPs in Group Six.
Fırat Enerji Üretim Otoprodutor A.Ş. in May 2010 was the highest bidder for the Bozkır, Ermenek and 10.5 MW Göksu HEPPs in Karaman and Konya provinces with a $86.4 million offer. The three represent the power plants in Group Seven.
The Seba Group was the highest bidder for the Group Eight HEPPS the Dere and the İvriz in Konya province with an offer of $5.7 million
İvme Elektromekanik Endüstriyel Otomasyon Sistemleri Sanayi ve Ticaret Ltd. on April 29, 2011 acquired the Kayadibi Hydroelectric Dam HEPP in Bartin province for $7.644 million. The Kayadibi was the sole HEPP in Group Nine.
Kayseri ve Civari Elektrik T.A.Ş. in January 2011 acquired the management rights for the Bunyan, Camardı, Pınarbaşı, and Sizir HEPPs in Kayseri and Niğde provinces for 49 years for $69.7 million offer. The four represent the HEPPs in Group 10.
Ka-Fnih Energy Joint Venture in February 2011 acquired the management rights to the Değermendere, Karaçay, and Kuzucullu HEPPs in Hatay and Osmaniye provinces, in southern Turkey, for $7.020 million. The three represent the HEPPS in Group 11.
Kayseri ve Civarı Elektrik A.Ş. in March 2011 acquired the Group 13 Besni, the 4.5 MW Derme, the Erkenek and the Kernek HEPPS in Adıyaman and Malatya provinces for $13.8 million.
Boydak Enerji Üretim ve Ticaret A.Ş. in February 2011 acquired the management rights to the Bayburt, the Çemişgezek and Girlevik HEPPs in Tunceli, Erzurum and Bayburt provinces for 49 years for $29.050 million offer. The three dams represent the barrages in Group 14.
Demistaş Doğu Elektrik Makine İnşaat Sanayi ve Ticaret A.Ş. was the highest bidder for the Group 15 HEPPS the Esendal and Işıklar (Visera) in Artvin and Trabzon provinces with an offer of $6.550 million.
Nas Enerji in February 2011 acquired the management rights for the Group 16 HEPPS the 14.4 MW Cag Cag, Otluca, and Uludere in Mardin province for 49 years for $40.8 million.
Mostar Enerji Elektrik Üretim A.Ş.in February 2011 acquired the management rights of the Adilcevaz, Ahlat, Malazgirt, Varto and the Sonmez HEPPs in Bitlis and Muş provinces in eastern Turkey for 49 years for $6.350 million. The two represent the HEPPs in Group 17.
Nema Kimya-Espe Joint Venture Group in May 2010 was the highest bidder for the Group 18 the Engil, Ercis, Hosap, Zeyne and Koçkçprü HEPPs in İçel and Van provinces with a $50.050 million offer.
Kisan Construction and Engineering Industry and Commerce A.Ş. in May 2010 was the highest bidder of the Arpaçay-Telek and the Kiti HEPPs in Kars province with a $14.7 million offer. The two represent the power plants in Group 19.
The Savings Deposits Insurance Fund (TMSF) on November 27, 2010, rejected Bank Pozitif’s bid to acquire Adabank for $42 million, saying that minimum $90 million bid was required. It was the fourth failed effort to sell the bank. In August 2003, the TMSF, a state banking receivership fund, seized control over Adabank, one of two banks owned by Rumeli Holding (Uzan Group), when the bank could no longer meet its obligations to depositors. Adabank’s banking license was originally revoked. But the license was eventually restored. Founded in 1984, the bank operates out of one branch and employs 48 persons. In 2009, the bank reported a net income of $667,557 on assets of $34 million.
The ÖİB invited bids by November 27, 2008 for the Kars, Ercis, Ağrı, Muş and Erzurum sugar mills of the state sugar company TürkŞeker in eastern Turkey.
The ÖİB gave a June 27, 2011, deadline for bids for the privatization of the 100% stake of the Hamitabat Electricity Production and Trade Company, which operates a 1,120 MW thermal energy plant in Lüleburgaz, Kirklareli province, in Thracian Turkey, in the first sale ever of a major power production facility. The ÖİB on its web site said that prospective bidders would need to post a refundable $30 million bond for the power plant, constructed in the 1980s by Swedish-Swiss Asea Brown Boveri and Turkey’s Enka İnşaat. The facility, which generates seven percent of Turkey’s electricity, has eight 92MW gas turbines and four 96MW steam turbines.
The Ministry of Transportation and Telecommunications gave an August 23, 2011, deadline for bids for the 414km-long North Marmara Express Highway and Third Bosphorus Bridge. The project is to be constructed on a build-operate-transfer (BOT) basis, with the winners of the tender constructing and operating the highway and bridge for a certain amount of time, possibly 15 years, after which they would be turned over to the state.
The ÖİB invited bids by January 21, 2010, for TurkŞeker A.Ş. Elazığ, Malatya, Erzincan and Elbistan Sugar Mills in eastern and southern Turkey.
The Savings Deposits Insurance Fund (TMSF) invited bids by May 15, 2007 for the Sivas Steel Factory, in Sivas, east central Turkey. A minimum bid of $63.9 million is required. The TMSF took control of the former state steel factory from Siv-Yat Sivas Sanayi Yatırım Ticaret A.Ş. against its debts to the state.
The TMSF invited bids for lands along the Berke Hydroelectric Dam, formerly owned by the Uzan Group. The TMSF seized control of the properties in southern Turkey from the Uzan Group after its owners failed to come up with a plan to pay their up their debts to the state.
The government is planning to sell 473,419 hectares of deforested lands throughout the country in a bid to bolster the real estate market. The properties are known as the 2B lands.
The Saving’s Deposits Insurance Fund (TMSF) invited bids by August 3, 2010 for Cine 5 TV channel and Le Chic FM Radio that were owned by disgraced former banker and financier Erol Aksoy. A minimum bid of $45 million is required for Cine 5 TV. The TMSF is seeking to recover $1 billion in debts owned by Aksoy to the state.
The state Mineral Technical Exploration Institute (MTA) invited bids by November 27, 2006, for the transfer of the operating rights of 18 high temperature geothermal fields and three wells in ten provinces. Turkey aims to privatize 33 other geothermal fields and 30 geothermal wells. Turkey has the richest geothermal resources in Europe and seventh biggest in the world, with the “theoretical potential” for 31,000 MW of electricity generation capacity a year, according to the state Mineral Technical Exploration Agency (MTA). Turkey has 1,000 known geothermal wells and mineral springs. Of these 184 have temperatures of over 104 degrees Fahrenheit. Some 13 have temperatures averaging anywhere between 266 degrees Fahrenheit and 467.6 degrees Fahrenheit and are suitable for electricity production. Some 77.94% of the country’s geothermal resources are located in the Aegean region, while 8.52% and 7.43% are situated in Central Anatolia and the Marmara regions of the country while 4.77% are in Eastern Anatolia. Other areas of the country have insignificant geothermal resources. Central heating from geothermal energy currently heats some 103,000 homes and 215 SPAs in Turkey. It said six percent of the country’s geothermal energy is used to produce electricity, 55% for heating homes and 39% for other usage, including heating of SPAs and electricity for industrial usage. Geothermal energy is harnessed in producing electricity in Kızıldere, Denizli (20 MWe) and Salavatlı, Aydın (7.9 MWe). The Energy Market Regulatory Agency issued production licenses for another 5.5 MW geothermal plant in Kızıldere and a 7.5 MW plant in Tuzla, Çanakkale. A 10 MW geothermal plant in a project phase in Simav, Afyon, in western Anatolia is also in the pipeline. MTA wants to transfer the operating rights of 18 high temperature geothermal fields and three wells in ten provinces to the private sector.
