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Turkey's troubled Cukurova Group agreed a $3.3 billion financing with Alfa Telecom that may hand the Russian firm a stake in its lucrative arm Turkcell, after it ditched a deal with TeliaSonera. The agreement announced on Wednesday gives Alfa an option to buy 13.22 percent of Turkcell, Turkey's leading mobile phone firm.
Nordic telecoms firm TeliaSonera holds 37 percent of Turkcell and is in a legal dispute with Cukurova over the failed accord to buy a further 27 percent stake.
Sweden, owner of 45 percent of Telia, raised the pressure on Cukurova with a minister saying the dispute was a test of Turkey's economic and legal system, just as the country prepares for what is set to be tough EU entry talks beginning in October.
"It is troublesome for Turkey," Swedish Industry Minister Thomas Ostros, responsible for overseeing the state's shareholdings, told Reuters in an interview late on Tuesday.
Cukurova said the financing from Alfa, owned by Russian magnate Mikhail Fridman, would be used to repay its debts to the state banking fund TMSF and to buy a stake in Turkcell held by Yapi Kredi.
The group owes about $1.6 billion to the TMSF resulting from a debt-restructuring deal with regulators in 2004 after the collapse of its Pamukbank. It also has debts of $2 billion to Yapi Kredi, in which it holds a controlling stake that it is currently selling.
The funds under the deal with Alfa will consist of a $1.707 billion, six-year loan and a $1.593 billion convertible bond maturing in 2011, Cukurova said in a statement to the Istanbul Stock Exchange.

Copyright Reuters, 2005

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