24 Ocak 2012 Salı

Turkey talks with S Arabia over Iran oil

Gökhan Kurtaran- ISTANBUL- Hürriyet Daily News

TÜPRAŞ, Turkey’s sole oil refinery, is a big buyer of Iranian crude oil. DHA photo

Turkey has already started looking at Saudi Arabian oil to ensure its economic stability and compensate imports from Iran due to United States pressure to cut its links with its eastern neighbor, said Turkey’s top energy experts yesterday.

“Turkey could not resist the pressure from U.S. for a long time,” Necdet Pamir, board member at World Energy Council Turkish National Committee, told the Hürriyet Daily News in a phone interview.

Pamir’s statements followed the European Union’s decision yesterday to slap an oil embargo against Iran’s oil exports. Turkish officials are currently in talk with the Saudi Arabia to compensate Turkey’s 30 percent crude oil import from Iran, Pamir said. “Saudi Arabia remains the only country that could increase it oil production capacity by 3.5 million barrels per day,” said Pamir, adding that currently total crude oil export of Iranremains nearly 2.4 million barrels.

Turkey imports nearly 30.6 percent of its crude oil from Iran which rose to 217,000 barrels per day in last year. However, if all the countries rush for Saudi oil at the same time, Turkey might face some sourcing problems, he said. “A one dollar jump in price-per-barrel adds $170 million to Turkey’s bill,” said Pamir. “If Iran closes Strait of Hormuz as it threatens, the prices per barrel might reach $180,” said Hasan Selim Özerden, Eurasian expert from International Strategic Research Organization (USAK). He said Turkey, which recently accepted an early warning radar system deployed at a military base near Malatya in eastern Turkey, might be exempted from joining western alliance sanctions on Iran.


Ankara, Arbil likeminded on Iraq’s future

Gökhan Kurtaran- ARBIL – Hürriyet Daily News gokhan.kurtaran@hurriyet.com.tr

Iraqi Kurd leader Barzani (L) meets Çağlayan who hails Arbil as his home. AA photo
Turkey supports the unity and stability of Iraq, according to Turkey’s Economy Minister Zafer Çağlayan, who expressed disappointment with Iraq’s prime minister’s recent comments on Turkey’s role in the region during a visit to Kurdistan Regional Government (KRG) cities yesterday.

“Our visit here to Arbil and Suleymanyah itself is a message,” said Çağlayan after his 45-minute meeting with Masoud Barzani, the president of KRG, at his command center in Selahaddin. Later in a forum in Arbil, Çağlayan said, “Arbil mala mıne ji,” which means “Arbil is my house” in Kurdish, while addressing local businessmen there.

“We are thinking in the same way about Iraq’s future” with the northern Iraqi administration, said Çağlayan at a press meeting at Barzani’s headquarters nearly 20 km to the north of Arbil.

However, he also said Iraq Prime Minister Nouri al-Maliki’s strongly worded statement Jan. 13 in an interview with private broadcaster al-Hurra was “upsetting.” “Turkey is playing a big role that might bring disaster and civil war to the region, and Turkey will suffer because it has different sects and ethnicities,” al-Maliki said.

“We want Iraq to become a united welfare country,” Çağlayan said. “Turkey has never intervened in the internal affairs of other countries and will never intervene. A single united Iraq respecting all religions and ethnic roots is our desire.”

Çağlayan also met with Nechervan Barzani, the leader of the Iraqi Kurdistan Democratic Party, during a breakfast yesterday, prior to his meeting with Masoud Barzani.

“Both Nechervan Barzani and Masoud Barzani are thinking the way we are,” said Çağlayan, signaling that the Ankara-Arbil ties were in a deeper spat. The Turkish minister’s trip, however, did not include Baghdad.

Trade swells
“Trade and politics are separate matters,” Çağlayan said about last week’s call by some members of Iraqi Parliament to cut trade relations with Turkey.

“Syria has tried to cut ties with us; but on the second day, they continued to trade,” Çağlayan said, adding that Turkey is dedicated to increase bilateral trade ties with its southern neighbor. “Until now we have received no sign or any notification from the Iraqi government regarding such issues,” he said.

“We will continue increasing our bilateral trade with Iraq,” Çağlayan said, adding that the total trade volume of both countries hit nearly $12 billion by the end of last year. He also said nearly 70 percent of trade is done with the northern administration of Iraq.

Turkey’s total exports to Iraq rose to $8.5 billion by the end of last year, ranking Iraq as Turkey’s second biggest export destination, Çağlayan said, adding that Turkish businessmen have approximately $16 billion of direct investment in the country.

$400 million deal
The central government of Iraq still supports good relations with Turkey, Çağlayan said, adding that the central government approved two important business deals Jan. 17.

Iraq’s Electricity Ministry approved the electricity distribution deal for $235 million to be run by Enka and a hospital project in Baghdad to be built for $125 million by Dorçe, a Turkish construction company.


Move to Baghdad, Iraqi gov’t tells Turkish banks

Gökhan Kurtaran- Istanbul - Hürriyet Daily News gokhan.kurtaran@hurriyet.com.tr
The tensions between the central Iraqi government and the regional administration in north over disputes on oil fields is affecting Turkish lenders in Arbil. Baghdad calls on Turkish banks in Arbil to carry head offices to the capital city

Turkish and Northern Iraqi top officials attend an opening ceremony of an airport in Arbil in this March 30 photo before they opened branches of Turkish banks there. AA photo

Turkish lenders operating in northern Iraq have been urged by the Central Bank of Iraq to start up main branches in country’s capital city Baghdad, according to the officials of the Turkish banks’ branches in Arbil.

The Central Bank of Iraq has sent written notification stating that Turkish banks were operating through branches on Gulan Street in Arbil, the capital of the Kurdistan Regional Government (KRG), according to a source from a lender who was speaking under condition of anonymity during a phone interview yesterday.

“We already knew that when we opened the Arbil branch, we were obliged to open a main branch in Baghdad according to Iraqi laws,” said Özel Oto, general manager of İşbank’s Arbil branch told the Hürriyet Daily News.

Oto said the issue was not brought up due to the conflict between KRG and the Central Government of Iraq.

However, the source said the political conflict between the central and regional government escalated due to right of the oil and gas resources of the country and this underlies the latest push on Turkish banks “All the banks have started new plans of opening a main branch in Baghdad now according to the official notification from central bank,” the source added.

Plans for Baghdad branches
“We are planning to open a main branch in Baghdad on May,” said Oto. Among the largest Turkish lenders, İşbank, Vakıfbank and Ziraat Bank opened their first branches in Arbil in March 2011, with a ceremony, in which Turkish Prime Minister Recep Tayyip Erdoğan participated. Albaraka Türk and Bank Asya, leading providers of Islamic banking products in Turkey, which also plan to start up their first branches in the northern Iraqi city this year, will be obliged to open a main branch in Baghdad.
“We take the notification - from the Iraqi central bank - as a recommendation rather than an order,” said Yesur Meylani, the general manager of Vakıfbank’s Arbil branch. “We are planning to open a branch in Baghdad in addition to four other branches across the country in two years time.”

Meylani also said concern over the security conditions in the capital city was increasingly continuing. “If the security is sustained by the local authorities, our presence in the country will be easier,” he added.
“Following a prior notification to and approval by the [Iraqi] central bank, the main branch may open additional branch offices in Iraq, provided that one branch is designated a main branch of the foreign bank in Iraq where any process may be served,” according the article 6 of the Iraqi banking law.

Turkey’s Economy Minister Zafer Çağlayan is set to start a two day official visit today to Arbil and Suleymaniyah, another northern Iraqi province, along with representatives from nearly 100 Turkish companies to discuss bilateral trade and investment relations with the government officials. Previously, Çağlayan said Turkey and the northern Iraqi administration were committed to increase the annual trade volume with northern Iraq to $20 billion.

Turkey’s bilateral trade volume with Iraq jumped by nearly 50 percent to $11 billion as of the end of the last year compared with 2010 and nearly 70 percent of bilateral trade was with the northern Iraq, according to official data.

US firm building $36 mln worth mall in southeast

Gökhan Kurtarangokhan.kurtaran@tdn.com.tr
ISTANBUL - Hürriyet Daily News

Carver (R) says it is worth taking risks to invest in Turkey’s Mardin, while Çelik (L) predicts that locals will spend more in the future. Company photo

Investing in Turkey is more profitable than investing in China, according to Martin Carver, chief executive of a U.S.-based company that recently invested $36 million in a shopping mall, aqua park and hotel in Turkey’s southeastern province of Mardin.

“Upon meeting with some local businessmen in Mardin, I have decided to invest in the project,” said Carver, head of MG Consulting, while speaking to Hürriyet Daily News during a recent interview in Istanbul.

“I see no economic growth in European markets. That is why I would rather invest in Turkey,” he said.
Movapark, a shopping mall project in Mardin, will have a total area of 54,000 square meters in addition to an aqua park. “After completing the mall and aqua park project, we will also start construction of a five-star hotel with nearly 300 rooms,” he said.

Following the death of his father Roy J. Carver, founder of the U.S.-based Bandag tire chain, Carver served on the company’s board between 1981 and 2007. The company was sold to Bridgestone in December 2006 for nearly $1 billion, so Carver began investing in promising projects in multiple countries, including China, Brazil, South Korea, Singapore and finally Turkey.

Higher profits

Many Western companies still hesitate to invest in Turkey’s southeast due to ongoing unrest in the region, Carver noted. “They are not taking the risk for higher profit,” Carver said, noting that investing in emerging markets with robust growth was no more a choice but a necessity to diversify risks in an investment portfolio.

Kenan Çelik, board chairman of Movapark, said the life standards of the locals in the region were changing rapidly. “Southeastern Anatolia Project [GAP], the biggest irrigation project, is close to being completed. Locals will earn more from their fields and spend more in the future,” Çelik told the Daily News.

A new border gate in Nusaybin on Turkey’s Syrian border would energize the business climate in Mardin. “We know that the relations with Syria are still problematic, but once things settle down, the city will be the gateway to the Middle East and Arab Peninsula,” Çelik said.


Group promises ‘brand new’ platform for first domestic car

ISTANBUL - Hürriyet Daily News
Tofaş, the carmaker that has claimed to build a domestic car, will not use an already-existing platform, says Mustafa Koç, its top executive. This will be a mid-range car, he says

Turkish Prime Minister Recep Tayyip Erdoğan sits on the driving seat of a Ford Otosan car as Musafa Koç of the Koç Holding accompanies him during a ceremony in the northwestern province of Kocaeli in 2009. Koç has said it is studying with Fiat, its Italian partner in Tofaş, on a domestic car production upon a call by the government. AA photoTofaş, the local carmaker that announced it will build the first domestic passenger car with limited help from Fiat, will use a totally new platform for the project, according to the head of Koç Holding, which co-owns Tofaş with the Italian company.

“We will neither use the current facilities of Albea nor Palio models of Fiat in Turkey,” Mustafa Koç, the Koç chairman, told the press on the sidelines of the Turkish Industry & Business Association (TÜSİAD) general assembly yesterday.

Tofaş will receive only technical support from Fiat, Koç added. Tofaş currently produces Fiat cars in the northwestern province of Bursa.

The Turkish government is urging local industries to launch a domestic car brand. The government is set to unveil a domestic auto production incentive scheme next month as companies other than Fiat and Turkey’s Tofaş may also launch such projects in time, said Turkey’s Science Technology and Industry Minister Nihat Ergün on Jan.18.

“This will be a car that everyone could purchase, a mid-range car,” Koç told the press, adding that there was not a schedule and the volume of the probable investment was still being discussed.
“Turkey has to understand the difference between a national brand and national car,” said Ali Kibar, chief executive of Hyundai Assan, on the sidelines of the TÜSİAD meeting, regarding recent claims that the national car of the country might be produced under the Fiat and Tofaş partnership.

“For some models, our production is also based nearly 60 percent on domestic production. If this is the case, we should also be considered as a national auto then,” Kibar added, criticizing the current bid by Koç Holding.

Shift in top Tofaş post

Koç’s statements came only one day after Ali Pandir, Tofaş’s chief executive, resigned, leaving his seat to Kamil Başaran, according to a filing by the company to the IstanbulStock Exchange (İMKB).

Ali Pandir had been the chief executive officer of Tofaş since Nov. 1, 2006, and the resignation would take effect as of today, the filing said, adding that Pandir would be assigned to another position within the Fiat group.

Başaran started working for Tofaş in 1984. He was assigned to Fiat’s international organization in Italy in 2004. He worked there as the director of supplier development and cost management department between 2004 and 2007. He was the chief executive of Martur and Fompak, automotive sub-industry firms, before the assignment to Tofaş’s top helm.

Ford Otosan to boost investment

Meanwhile, Ford Otosan, the Turkish unit of Ford Motor Co. in partnership with Koç Holding, plans to invest in a light vehicles facility with an annual capacity of 110,000 items, in a bid to support its exports, according to General Manager Nuri Otay.

Investment will take place in the first quarter of this year, Otay said during a press meeting in Istanbul yesterday.

The company plans to boost investments up to $1 billion this year and a $250 to $300 billion portion will be allocated to the new facility, he said.

However, Ford Otosan expects to produce 288,000 vans this year, fewer than the record 296,000 it built in 2011.

The company paid 519 million Turkish Liras ($283 million) of dividends in 2011, the general manager said.

Gökhan Kurtaran from Istanbul contributed to this report.


15 Ocak 2012 Pazar

Japanese companies join forces for Istanbul bridge

Gökhan Kurtaran- Istanbul- Hürriyet Daily News gokhan.kurtaran@hurriyet.com.tr

Only days after a failed government tender for the construction and operating rights of a large toll road and a third bridge over Istanbul’s Bosphorus, Japanese candidates decide to set up a consortium to re-try their chances

Four Japanese firms are still interested in building a third bridge over Istanbul’s Bosphorus following the failed tender by the Turkish government Jan. 10, according to a Japanese diplomat.

“Japanese companies are still showing their interests to join the construction of the third bridge,” Yasuhiro Fukuda, trade attaché from Japanese Embassy in Ankara, told the Hürriyet Daily News in an interview yesterday. 

Mitsubishi, IHI, Obayashi and Itochu, the companies that were authorized to but did not attend the tender, along with five more foreign and nine local competitors, were still willing to take their chances and restart the talks with the government, according to the Japanese official. 

“They are open to talks on the details of the project with the government officials,” said Yasuhiro. 
The cost of the highway road project that stretches from Adapazarı to Tekirdağ in Turkey’s northwest, which also includes a third bridge over Istanbul’s Bosphorus, was estimated at $6 billion.

“The project is too big to finance,” general manager of one of the Japanese firms told the Daily News under the condition of anonymity yesterday by phone. Both construction and operating rights of the third bridge and the highway should be divided and introduced as two tenders, which would ease financing, the source said.

“A smaller scale would make the project feasible and profitable for us,” the source said, adding that Japanese firms were preparing to start the talks with Turkey. “Any action plan including some incentives from Turkish government would be appreciated by us,” said the executive.

Talks may start soon
Despite the failure of the tender, Fukuda said this shouldn’t be taken as a sign that the Japanese firms are losing their interest in the project. Bilateral talks between a possible Japanese consortium and the Turkish government was possible soon, he added. Turkey’s Finance Minister Mehmet Şimsek said Jan. 11 the state was capable of funding the project on its own, but preferred not to. 

The government offers 25-year operating rights for the toll road project which spans 414 km.
Cengiz, Gülsan, Kolin, STFA, Mapa, Nural, Park, Holding, Varyap and Yüksel were the possible local bidders. In addition to the Japanese firms, Stradag from Austria; Moskovskly Metrostroy, NPO and Mostovik from Russia; FFC Construction from Spain; and Astaldi from Italy also received specifications for the tender.

Financial woes hit highway and third Bosphorus bridge tender

ISTANBUL- Hürriyet Daily News

Among the 18 firms to receive specifications to build the North Marmara Highway, which includes a third Bosphorus bridge, not a single one is able to put a bid on the table

A key tender that included the building of a third bridge over Istanbul’s Bosphorus fizzled out yesterday, as none of the domestic and international companies were able to produce a concrete bid. As the deadline to place a bid expired at 2 p.m., the episode became a stark indicator of the unfavorable global and domestic climate for investment.

The potential bidders included Japan’s Mitsubishi, Italy’s Astaldi, Russia’s Moskovskiy Metrostroy, Austria’s Stradag and Spain’s FCC – all from countries that have been hit hard by the global financial crisis and the ensuing eurozone debt crisis.

After the deadline for the North Marmara Highway tender, there were no bidders, İhsan Akbıyık, a deputy chief at the General Directorate of Highways, said in Ankara. “As of 2 p.m., bids should have arrived. They did not,” Akbıyık said, adding that what happens now will be decided by the Transportation, Maritime and Communication Ministry and the General Directorate of Highways.

“Turkey has ‘alternative plans,’ Transport Minister Binali Yıldırım said in Istanbul before the tender fizzled out, without specifying what they were.

“If no companies bid for the third bridge, we will launch our plan B,” said Yıldırım. “If we receive no offers, nothing would change for us. We would evaluate the situation and decide according to our evaluation.”

Suggestion to slice the project
“Under the current conditions, it is not possible to finance such a big project,” an executive from one of the potential bidders said, according to a Reuters report. “This project could be sliced into pieces and then auctioned,” the executive said, speaking on condition of anonymity. “Or it could be given to contractors by the state through a negotiated tender.”

Minister Yıldırım said he acknowledged the “economic slowdown” in Europe. “[But] there is no crisis, or risk of a crisis, in Turkey. But there are some people who [lament] why Turkey didn’t go through a crisis,” he added.

Nine domestic and nine foreign companies received specifications ahead of the tender, which promised high returns through transport fees. After completing the giant project, the winning company or consortium would have had the “management rights” to the bridge and connected highways for 25 years. To make the project even more appealing, the investor liability in possible expropriation activities was cut from 950 million Turkish Liras to 400 million liras. This meant the Turkish state would undertake all land acquisition costs above this cap.

The project, which spans 414 km from Adapazarı to Tekirdağ, is described as Turkey’s second-biggest build-operate-transfer scheme. It was first announced on March 8 last year. Originally, the bidding was to be held Aug. 23, but potential bidders had asked for a delay.

In a written statement ahead of the tender, four chambers from the Turkish Union Engineers’ and Architects’ Chambers (TMMOB) said the auction itself constituted a crime according to existing laws. A lawsuit launched by TMMOB is proceeding at an Ankara court, the statement said, adding that a tender on a legally contested issue is against the law.

Gökhan Kurtaran from Istanbul contributed to this report.

Gov’t urges firm to push harbor construction to bypass Syria

Gökhan Kurtaran

ISTANBUL - Hürriyet Daily News gokhan.kurtaran@hurriyet.com.tr

The İskender Harbor is set to become operational in four to six months tine and will facilitate Turkey’s goal to become an export gate to the Middle East

İskenderun Harbor, one of Turkey’s primary gates to Middle East export markets, will start operating in four to six months following government requests to expedite upgrades to the site, according to an executive of the holding operating the port.

“We are trying to make it ready to ship containers as soon as possible due to the regional problems [impeding] the country’s trade with Gulf countries and the Middle East,” Serdar Bacaksız, a board member at Limak Holding, which won a tender to operate the port in the southern province of Hatay for 36 years, recently told the Hürriyet Daily News. 

The harbor currently has no capacity to handle ship containers, but the Turkish government has asked Limak to accelerate the construction process to increase the capacity of the port so as to assume a greater regional role, he said. 

“İskenderun is rapidly growing with its own economy and steel plants [as] increasing numbers of local and international companies in the region export products to the Middle East market,” he said. 

“The harbor will start operating in four to six months’ time,” Bacaksız said, adding that the company would invest nearly $350 million for the development of the harbor’s infrastructure. 

The company took over the port’s assets and liabilities from the Turkish government Dec. 30. On the same day, the company paid $372 million after obtaining a $425 million loan. The Ankara-based company, which also has construction, energy and airport interests, received loans from six banks for the acquisition, according to a written statement from the holding.

Bacaksız said the harbor’s container capacity would be increased to 150,000 20-foot equivalents (TEUs) within four to six months and added that the total container capacity of the harbor would reach 1.3 million TEUs within a few years. 

“We are aware of the strategic importance of the port, and we would like to complete the construction work as soon as possible,” he said. 

The total exports of İskenderun rose by 11.32 percent from $2.09 billion to $2.33 billion last year, the İskenderun Trade and Industry Chamber told the Daily News in an emailed statement. 

The share of the İskenderun port in the overall export figures of the district rose from $270 million to $297.5 million last year, according to figures. 

“We are expecting to … take the lion’s share in regional trade soon,” said Bacaksız. 

Meanwhile, in response to Turkey’s sanctions against the Syrian government, the Syrian Parliament approved legislation imposing a 30 percent tax on all Turkish-made products on Dec. 28. According to data from Turkey’s Customs and Trade Ministry, the number of Turkish trucks crossing over the Syrian border to trade with the region dropped from 5,000 to 300 per day in the last month. With Turkish exporters now focusing on alternative routes to bypass the Arab republic, Syria has lost nearly $150 million due to declining tax revenues from Turkish trucks. Moreover, Turkey’s trade with Syrian has slowed down significantly in the last month, declining by nearly $28 million to $65.3 million. 

Turkish Economy Minister Zafer Çağlayan has said the country is developing plans to bypass Syria by sending Turkish trucks to the Gulf via Roll-on/roll-off (RORO) services to Egypt’s Alexandria port.

9 Ocak 2012 Pazartesi

Forint’s waltz making Turkish companies dizzy

Gökhan Kurtaran-Istanbul-Hürriyet Daily News gokhan.kurtaran@hurriyet.com.tr

The Hungarian forint’s big depreciation is hurting Turkish businesses in the country along with locals, according to professionals. Some companies consider moving to United Kingdom, Germany or Turkey

Former Hungarian Prime Minister Ferenc Gyurcsany (2ndR) takes part to a protest against the government in front of the Opera in Budapest on Jan 2. AFP photo
Former Hungarian Prime Minister Ferenc Gyurcsany (2ndR) takes part to a protest against the government in front of the Opera in Budapest on Jan 2. AFP photo

Turkish businessmen who own businesses in crisis-hit Hungary have begun pulling out of the country and returning to Turkey due to a slump in profits caused by currency rates, said the head of a Turkish business association based in Budapest yesterday.

“There is an increasing number of Turkish businessmen leaving the country and shifting their investments to Turkey,” said Osman Şahbaz, head of the Turkish-Hungarian Business Association, speaking to Hürriyet Daily News in a phone interview. There are nearly 1,000 Turkish businessmen in Hungary, he said, noting that some of these business owners were considering shifting their businesses to Germany or the United Kingdom. 

The depreciation of the Hungarian Forint against the euro and U.S. dollar has also hit Turkish businessmen importing products from Turkey and neighboring countries, according to Şahbaz, who also owns Bosfor & Tempo Uno Kr, a textile company in Budapest. Due the forint’s depreciation against foreign currencies, revenues of Turkish businesses decreased by 18 percent in the fourth quarter last year, said Şahbaz. 

Şahbaz said, “The forint depreciated due to speculation the Hungarian government might delay talks with the International Monetary Fund.” He said, “One euro was nearly 282 forints nearly three months ago,” but increasing costs due to exchange rates have not yet been reflected in the prices. “We know that demand has slowed down in the country, and rather than hike prices we prefer to suffer a loss in revenues.” 

Akay Gökçe, head of the Turkish-Slovakian Business Council, said, “Turkish investors are concerned about the current economic situation in Hungary. Political difficulties in Hungary have caused a slowdown in attracting foreign direct investments, including those of Turkish entrepreneurs.” 

As the country is currently on the verge of a financial crisis, more Turkish business should be invited to Hungary, according to Gökçe. The red-tape discourages Turkish businessmen from investing in Hungary, he said. “Even some Turkish businessmen in the country with nearly 3 to 4 million euros of investment face visa difficulties.”

Currently, Çelebi Ground Handling, Global Rulman, Halkbank, Ege Seramik, Sarar, Novaplast, Karya Tour, Anunde Textile, Yataş, Temsa, Parson and Turkcell are among the leading Turkish firms operating in the Eastern European country, said the Turkish Treasury. 

However, “Turkish businessmen should realize the opportunities in Hungary,” said İsmet Güral, head of the Turkish-Hungarian Business Council at the Foreign Economic Relations Board of Turkey, and values of homes, hotels, shops and plants in Hungary slumped significantly due to the economic crisis. “I am also preparing to invest in Hungary,” said Güral, who is also owner of Güral Porcelain, one of the largest porcelain manufacturers in Turkey. 

Turkey’s exports to Hungary decreased from $604.08 million in 2008 down to $466.97 million last year, according to the Turkish Statistical Institute (TÜİK), while imports from Hungary rose to $1.37 billion last year from $1.28 billion in 2008. 

Investment company prepares for Saab bid

Gökhan Kurtaran-Istanbul-Hürriyet Daily News

Brightwell, a Turkish private investment company, is readying to bid for the acquisition of the recently bankrupt Swedish automobile company Saab, said the firm’s top executive. Saab plans to manufacture electric cars for the European and Middle Eastern markets, he added.

“We are in talks with a senior member of the board to acquire the company along with another Turkish firm,” said Zamier Ahmed, board member of Brightwell, speaking to Hürriyet Daily News in a phone interview. Saab is currently more than $1 billion in debt, but the automotive firm still has a successful future due to its well known brand name, he said. 

Talks with General MotorsBrightwell is also in talks with previous owners General Motors, which still holds some technology licenses, to resolve issues relating to the infrastructure and production capacity of the firm. 

Negotiations started long before the company filed for bankruptcy, after General Motors blocked takeover attempts by Chinese investors, Ahmed said. “The talks with chief executive Victor Muller were interrupted for some time, but we are now back at the negotiating table,” he added. “Contrary to popular belief in the Turkish public, we think the brand is worth investing in.” 

Previously, Turkish Industry Minister Nihat Ergün said Turkish investors should be aware of “the iceberg under the water,” warning businesses about Saab’s possible hidden debts. Yet, despite a belief among some Turkish ministers that Saab’s potential was not very high, “with the right investment the company would be a successful Turkish brand,” Ahmet said. “If we could acquire the company, we can start manufacturing electric cars in approximately three months’ time.”

Turkish Deputy Prime Minister Ali Babacan had also expressed concern over possible acquisitions in the past. 

Ahmet said the intention of Brightwell was in line with Turkey’s plans to manufacture its own domestic automobile brand as announced by Turkish Prime Minister Recep Tayyip Erdoğan last year.