Record tender for country's roads and bridges may be canceled

ISTANBUL - Hürriyet Daily News

A consortium of Koç Holding, Gözde Girişim and Malaysia's UEM Group Berhad won the tender with a record bid of $5.72 billion, the second highest privatization tender in Turkish history.

The privatization of Turkey’s toll roads and bridges in a record bid of $5.72 billion, as well as the country’s second largest natural gas grid, Başkent Doğalgaz, in a $1.16 million offer, may be canceled by the government.

“We will review the privatization offers, for example for the highways or bridges. We have much bigger expectations,” Prime Minister Recep Tayyip Erdoğan said in an interview broadcast live the evening of Feb. 1. The tender was the second highest privatization tender in Turkish history.

Erdoğan added that he believed Turkey could see significant funds introduced into the country.
A consortium of Koç Holding, Gözde Girişim and Malaysia’s UEM Group Berhad had won the tender. The tender, which was for a concession period of 25 years, included the Edirne-Istanbul-Ankara highway and the Bosphorus and Fatih Sultan Mehmet bridges linking the European and Asian sides of Istanbul. Official data from the country’s highways agency showed that the toll roads and bridges generated revenue of 740 million Turkish Liras in the first 11 months of the year.

Daily Hürriyet’s economics columnist Erdal Sağlam reported that officials from the general directorate had claimed during a meeting on the privatization process that the tender could be worth “$20 billion.”

Meanwhile, Turkish food company Torunlar Gıda placed a $1.16 million offer for Başkent Doğalgaz. However, Erdoğan mentioned that in the first tender for the grid, Global Investment had failed to pay its offer, $1.6 billion, thus wasting a $50 million guarantee. The controversial Karamehmet-Kazancı partnership also failed to pay the $1.2 billion contract price in another tender, resulting in a loss $107.6 million in guarantee fees. An offer of around $1.5 billion had previously been received, meaning that Torunlar Gıda’s $1.16 billion offer should be reviewed carefully, Erdoğan said.