Türkiye Wealth Fund to buy sanctioned Russian billionaire’s Turkcell stakes: Report

Türkiye’s state-owned investment fund, Türkiye Wealth Fund (TWF), is reportedly considering acquiring the largest corporate stakes in Turkish telecom giant Turkcell, currently owned by LetterOne, a company controlled by sanctioned Russian billionaire Mikhail Fridman and Petr Aven.

TWF, Turkcell’s largest shareholder, reportedly approached LetterOne to explore the possibility of acquiring its 19.8% stake in the telecom giant. However, business-focused bloomberg.com reported on Wednesday that it remains uncertain whether LetterOne is open to selling its shares, business-focused bloomberg.com reported on Wednesday.

Founded in 1994, Turkcell, the largest telecommunication company in Türkiye, provides both mobile and fixed network services. In 2020, TWF became the majority shareholder of Turkcell, securing control of the board with a 26.2% stake, which includes a 15% privileged share.

With Turkcell’s market value at $6.5 billion following a 61% share surge this year, its 19.8% stake is valued at approximately $1.3 billion.

Sanctioned Russian partners spark turmoil in Turkcell

The relationship between LetterOne and Turkcell has been contentious in the past. In 2022, LetterOne advocated for significant changes in Turkcell’s governance, including the dismissal of four board members, as part of its effort to attract global investors. However, Turkcell’s board ultimately turned down the majority of these proposals.

On the other hand, TWF uttered its concerns regarding sanctions over Turkcell’s Russian partners several times since 2022, following Russia’s invasion of Ukraine. Fridman and his partners also stepped down from the company’s board that year, as they were hit with sanctions by the U.K., EU and U.S.