Turkcell Seeks Board Approval to Distribute At Least 50% of Profit as Dividend

By Emre Peker

ISTANBUL-Turkcell Iletisim Hizmetleri AS (TCELL.IS), Turkey's biggest mobile phone operator, late Monday said it will seek board approval to distribute at least half of its 2013 profit as dividend, even as the company remains caught up in a shareholder dispute between the company's Turkish, Russian and Swedish owners.

The dispute between Turkey's Cukurova Holding AS, Moscow-based Alfa Group's subsidiary Altimo and TeliaSonera AB has meant that the Istanbul-based company hasn't been able to pay a dividend to shareholders since 2010. Shares rose 1.3% to TRY11.4 in Tuesday trading, but are still of the all-time high of TRY12.65 reached in mid-January as hopes for a resolution to the management crisis peaked. Turkcell forecasts as much as TRY3.5 billion ($1.95 billion) in earnings before interest, tax, depreciation and amortization, or Ebitda, in 2013.

Yet the payout is far from a done deal. TeliaSonera, the Nordic telecommunications company with a 37% stake in Turkcell and Altimo blocked dividend payments in 2010 and 2011. Turkcell's board is still in a gridlock amid pending court cases to settle the company's ownership.

Speculation that a resolution may be near mounted after the company's Capital Markets Board of Turkey in March appointed three independent members to Turkcell's board, but analysts caution that it is uncertain whether they would approve dividends.

Write to Emre Parker at [e-mail]

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