Bloomberg News

Turkey Forecasts 2012 Asset Sales of $3.5 Billion, Below Target

November 19, 2012

Turkey will miss its 2012 privatization goal as some sales spill over into next year, Turkish Finance Minister Mehmet Simsek said.

The country has earned 6.3 billion liras ($3.5 billion) from asset sales so far this year, of which 4.5 billion liras came from the sale of a stake in Turkiye Halk Bankasi AS (HALKB) last week, Simsek said at a press conference in Ankara today. Revenue is likely to rise to 6.8 billion liras by year-end, below the target of 10 billion liras, he said.

Postponement of some revenue into 2013 means that year’s goal of 4 billion liras is “achievable” and may be exceeded, Simsek said. This year’s income will be used to pay down government debt and to reduce borrowing needs. Yields on two- year Turkish benchmark debt fell 15 basis points to a record low of 6.28 percent at 3:40 p.m. following his comments.

Turkey’s budget deficit more than doubled in October from a year before as a slowing economy curbed tax revenue and government expenditures jumped.

Preparations are also being made for a possible sale of the government’s remaining 32 percent stake in fixed-line phone and internet company Turk Telekomunikasyon AS, and a decision will be made based on market conditions, Simsek said. Turkey hired advisers including Barclays Bank Plc to advise on the sale.

Turk Telekom shares fell for a fourth day, dropping 0.6 percent to 6.50 liras, headed for the lowest close since June.

There are no immediate plans for a block sale of the government’s remaining 51 percent stake in Halkbank, though it might be considered in the longer term, Simsek said. The asset sales agency is preparing to collect final bids for roads and bridges, and sending invitations to potential bidders for remaining power grids, he said.

To contact the reporter on this story: David Neylan in Ankara at dneylan1@bloomberg.net; Ali Berat Meric in Ankara at americ@bloomberg.net.

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net.


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