A Turkish Private Equity Web Log

In an effort to cover the Turkish Private Equity Industry - for the promotion of Entrepreneurship, the private equity asset-investment model, and the communication thereof.

Turkey to auction off media assets of Medya Yayın Holding, Sabah Newspaper and ATV
UPDATE 12/10/07: The Turkish government has postponed the auction of the atv television station and Sabah newspaper from Nov. 7 to Dec. 5.

UPDATE: As of the 25th of September, the TMSF announced that so far there are 5 prospective bidders for the assets of Turkish media firm ATV-Sabah at auction in November. The RTL Group, Rupert Murdoch's News Corp., Germany's ProSiebenSat.1, Czech CME and unlisted Greek broadcaster Antenna TV have all bought the $50,000 documents necessary to take part in the tender. The TMSF contacted Reuters with this information.

Relevant and Recent News Links:

    Date          Title-Link         Source    
11-9-07 Market Share of Television Advertising in Turkey: An Update on the sale of Merkez Yayin Holding Grandstanding Traction (Recent Post)
29-9-07 Greek media group eyes Sabah/ATV TDN

Original Post:Turkey's State Deposits and Insurance Fund announced that it will auction off repossessed media assets of Medya Yayın Holding, Sabah Newspaper and ATV on November 7th. Although Turkish law dictates that Turkish media outlets cannot be owned by a certain percentage by foreign buyers, this should provide an interesting investment opportunity for those willing to get into the space. We will have to wait until the auction to see how the investment consortiums shake out, in both the domestic and international sense. TDN covered an interesting story concerning the international speculation on prices and bidding. Apparently, the first day after the seizure, two bidders representing private equity firms called the TMSF inquiring about the seizure.

As an investor, this would provide a unique opportunity to either spin out some of these outlets for instant profit-taking. Managers at ATV should also be scratching their heads, pondering a prospective MBO opportunity. ATV is one of Turkey's major televison channels that garners a large market share of advertising revenue and possesses a long list of contracted actors as assets. These features alone could provide very interesting collateral for private equity firms to make use of debt in leveraging this buyout. Cash flows should be at such a rate to make this a very lucrative gearing opportunity. Needless to say, their are immediate opportunities here for spin-outs and turnaround of investment.

The Doğan Group, the owner of competitors Hurriyet newspaper and other media outlets, will not be bidding for the group. If they were, it may raise eyebrows at potential monopolistic tendencies.


Quite frankly, both Hurriyet and Sabah are paparazzi rags that are more interested in exploitation of what sells rather that objective news gathering. This is another reason why Sabah would be such an interesting opportunity because its popularity was certainly gaining on the Hurriyet and they very well could surpass them as the leader, given the right changes (albeit good or bad).

UPDATE: A fellow reader sent me an email and asked for a little more information:
hello there i'm iann and i keep in romania a blog about media issues in south eastern europe what is the real sotry about Medya Yayın Holding? because i dont understand what is State Deposits and Insurance Fund and hi s implication in this transaction and also the trails about the property so if you have time to explain me a little bit the situation it would be breat best regards iann http://aluiann.wordpress.com [romanian]
Well Iann, first of all the TMSF is a government organization that repossesses the assets of companies and individuals and are either unable to pay their bills, have defaulted on loans and declared bankruptcy or have been prosecuted for illegal practices. The case with Merkez Yayin Media is that secret contracts were signed between the owner of a seized bank and the current owner of Merkez Yayin, basically sharing ownership. These documents were later uncovered and since the owner of Etibank owed somewhere in the region of $900 million, the media assets were seized. Here is an excerpt:
Bilgin Group's approximately $900 million debt to the TMSF is due largely to Etibank. In April, following the exposure of secret agreements between Etibank's leading partner Dinç Bilgin and the head of Merkez Group, Turgay Ciner, the TMSF took over the management and supervision rights of Bilgin and Merkez Group's 73 companies showing activity in the media sector. After the TMSF had confiscated Bilgin's Etibank in 2000, Ciner purchased ATV and Sabah in 2005 by signing a protocol with Bilgin and the TMSF.
So basically, that is what went wrong. Now, for the good part, here is a a breakdown of advertising market share represented by the 5 largest media groups in Turkey as published in Sabah last week:
Market Share of TV Advertising in Turkey
GROUP 2005 2006 2007/MAY
Doğan Group 38.6 40.0 45.0
Merkez Yayin Group 22.4 25.0 21.0
Çukurova Group 15.2 14.0 15.0
Doğuş Group 10.7 10.0 9.0
Other Groups 13.0 10.0 10.0
Once again, I will restate that Doğan Group has said they will not be bidding, but speculators, analysts and the common man on the street think that they may somehow take a stake in one of the consortium syndications that sit at the bidding table. Again, we will have to see how these shake out. Meanwhile, my friends in the trading business are now bullish, going long on Doğan Group and Hurriyet equities.

Merkez Yayin Holding consists of 5 newspapers (Sabah, Takvim and others), 40 magazines, 1 radio station, 2 national (ATV and Kanal 1) and 1 domestic television channel, 1 news agency, and a publishing business.

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Posted @ 11:31  
  • At 9/25/2007 5:49 AM, Anonymous public auction said…

    The question remains in my mind as to the fairness and balance in this process. I am concerned for the little guy here.

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