Pro-gov’t Turkish boss places bid ‘to be defense and media giant’
Ethem Sancak’s company ES Mali Yatırım has placed offer for BMC. DHA PhotoBusinessman Ethem Sancak, known for his close ties to the government, announced his ambitious plan to build a blockbuster media and defense giant that will have “regional power,” describing his offer for the motor company BMC as the first step to “achieving 20-year dreams.”
“I have positioned myself for the next 20 years and set two strategic targets for myself,” Sancak said yesterday, speaking after presenting an offer in the tender for armored vehicle maker BMC, which was seized by the country’s state fund last year from Turkish conglomerate Çukurova.
“One of them is to build a strong media sector that will also have influence in Asia. The second one is to gain a strong position in the defense industry, starting this from the automotive industry,” he added.
Sancak’s firm, ES Mali Yatırım ve Danışmanlık, pledged to pay 725 million Turkish Liras ($342 million) for armored vehicle and bus manufacturer BMC as the only bidder. The estimated price of the company had been set at 958 million liras after tough negotiations between BMC and the tender commission.
As Sancak’s initial offer was only 540 million liras, far below the estimated price set by the Savings Deposit Insurance Fund (TMSF), tender commission head Hamit Sarı asked him to review fund’s offer several times before accepting 725 million liras as the final offer. The price will be presented to the TMSF board and the final negotiations will be conducted May 2.
Controversial media entrance
Sancak also acquired former Çukurova media assets, daily Akşam, SKY 360 TV channel and Alem Radio from the TMSF in November 2013.
Sancak’s name emerged as part of a wave of audio recordings incriminating Prime Minister Recep Tayyip Erdoğan, his family and close businessmen. The leaked conversations allegedly featuring him talking with other prominent businessman and media figures imply that he acquired former Çukurova assets upon government directives.
BMC has been in a tight squeeze since May 2012, when the company first failed to pay salaries on time, and production at BMC factories has halted several times in the intervening period. The İzmir-based vehicle manufacturer was supposed to deliver 468 armored vehicles (Kirpis) and trucks in a range of sizes to the Turkish Defense Ministry by the end of 2012. However, the company succeeded in only delivering 295 of the order until recently delivering 25 more Kirpis and trucks at the end of March.
The TMSF seized BMC, along with 11 other group companies, from Çukurova last May, alleging that it had failed to make payments on $455 million worth of debts owed to the fund.