Sammy Ofer subject in Turkish refinery deal lawsuit

Ofer was a member of a group that bought 14.7% of Tupras without at tender in 2005.

A lawsuit has been filed in a Turkish court against the head of Turkey Prime Ministry Privatization Administration (OIB) president Metin Kilci and two other top officials on suspicion of negligence in the sale of 14.7% of Tupras (ISE:TUPRS) oil refinery to a group of investors, including Sammy Ofer, the controlling shareholder in Israel Corp. (TASE: ILCO).

The Turkish media reports that the lawsuit is asking for 3-6 months in prison for the officials because of the lack of transparency in the stock allocation of the Tupras stake to Ofer. The lawsuit says that the stock allocation was illegal and did not comply with privatization procedures.

In March 2005, Ofer and his partners bought 14.7% of Tupras from the Turkish government without a tender for $430 million. In a subsequent tender, in which the Ofer group participated, a consortium comprising Turkish companies KOC Holding (ISE:KCHOL), Aygaz, and Opet, and Royal Dutch Shell plc (NYSE:RDS; LSE; AEX: RDSA, RDSB) acquired 51% of Tupras for $4.14 billion.

Turkish unions later asked the Turkish government and courts to investigate how Ofer bought Tupras shares without a tender. The unions claimed that Ofer made a paper profit of $770 million on his stake in the company within six months.

Published by Globes [online], Israel business news - www.globes.co.il - on May 3, 2007

© Copyright of Globes Publisher Itonut (1983) Ltd. 2007

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