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13 June 2003 - Turkish authorities yesterday seized control of two power utilities acquired by the controversial Uzan family and cancelled operating licenses, citing violations of legal obligations following the companies' privatization in 1993.
The Turkish Energy Ministry said that the decision to reclaim control of Cukurova Elektrik and Kepez Elektrik came after they refused to transfer transmission rights to the state Electricity Transmission Company (TEIAS) as demanded by an IMF-backed electricity market law that aims to liberalise mostly state-owned industry.
The ministry has seized all production, transmission, distribution and commercial facilities of the companies and trading in the companies' shares, which were already on the watch list, were suspended
Cukurova Elektrik and Kepez were awarded the right to distribute electricity in five Mediterranean cities under a deal with the Energy Ministry in March 1998. The incoming AKP party have been unhappy that there hands were tied to unfavourable agreements giving the two transmission companies exclusive right to sell electricity to consumers to the five cities.
The Uzan family is engaged in legal dispute with US equipment maker Motorola over a $2bn loan to Uzan mobile phone operator Telsim.
Motorola (MOT.N) says the Uzans defrauded them of the $2bn and is seeking repayment. Telsim denies the allegations and has demanded arbitration.
Uzan's Standart Kimya Petrol Dogalgaz Sanayi ve Ticaret A.S. has submitted the most competitive bid for petrochemicals firm Petkim, in the first tender of the government's ambitious IMF-backed privatisation programme. The government will have to decide over the coming days who Petkin will go to. High Privatisation Board (OYK) has yet to approve the tender results and Ali Coskun, Industry Minister and a member of the OYK, said on Thursday the seizure of energy companies would not affect the process in Petkim sale.
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