Company to Watch: Turkcell/Turkey
Istanbul-based Turkcell Iletisim Hizmetleri, the leading mobile-phone service provider in Turkey, with more than 26 million customers, operates in virtually every Turkish town with more than 3,000 people. The company’s revenue increased to more than $1 billion in the second quarter, while earnings rose 67% to $214 million.
Turkcell’s subscriber base increased 19.7% in the 12 months through September 30, but with the domestic market blanketed, the company is looking to further its expansion into neighboring countries. Turkcell has interests in mobile-phone operations in Azerbaijan, Georgia, Kazakhstan, Moldova, northern Cyprus and Ukraine. However, the company’s landmark contract to build a badly needed second mobile network in Iran is experiencing some static. So far, Turkcell has largely ignored a decision by Iranian authorities to negate the deal and give the work to South Africa-based MTN. Turkcell says it has until November 21 to pay a €300 million license fee for its 49% stake in the venture, which was cut back earlier this year from 70% by Iranian lawmakers worried about national security issues. Problems in closing the deal have shaken the confidence of potential foreign investors, who are worried about meddling in the economy by Iran’s hardliners.