Wednesday, December 14, 2005

Vodafone to Buy Turkish Phone Company

Vodafone agreed Tuesday to buy the Turkish mobile operator Telsim for $4.55 billion, making an expensive bet that it can fix the company and that Turkey's youthful population will rapidly embrace the use of cellphones.

A Vodafone director, Andre Sokol, left, shakes hands with Mehmet Caliskan of the Turkish Savings and Deposits Insurance Fund, which put Telsim on the block.

Telsim, Turkey's second-largest mobile operator, with nine million customers, has a troubled history but potential for growth. Telsim defaulted on billions of dollars in loans from Motorola and Nokia in 2001, and the Turkish government seized the company from the Uzan family in 2004.

As part of a previously agreed settlement, Nokia will receive $341 million from the Telsim sale, and Motorola $410 million.

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