merlin

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TEKEL's cigarette division to be sold separately next year....
Turkey's state-owned tobacco, cigarette and salt production and sales concern TEKEL will be broken down into separate entities, and the cigarette division will be privatised separately next year, Turkish Daily News reports.

TEKEL had been put on the block to be privatized twice before, but in both cases the tender was scrapped because of low-price bids in the first tender and lack of any bids in the second.

TEKEL's leaf tobacco and salt concerns' losses make the cigarette section unprofitable when under the umbrella of the same enterprise.

The officials plan to make the cigarette division profitable in the third quarter of 2005 and eventually seek a new tender to privatise the company.

The separated leaf tobacco and salt concerns, if unable to be rehabilitated, would be closed.

The method for privatization is far from clear.

In the two failed privatisation attempts, a block sale of the company had been attempted and it seems this would be the preferred model of sale once again.

However, in order to attract foreign companies, the sale of majority shares could also be considered.

Finally, if the aforementioned two models were found to be unfeasible, a further breakdown of the cigarette division could be in the cards, with the marketing section annexed from the main unit.

However, if marketing were to be separated, a block sale of the company would be impossible.

Meanwhile, the cigar production subsidiary of TEKEL was auctioned off on Tuesday for $1.325 million.

Two companies - Che Tutun ve Tutun Mamulleri Alkollu Icecekler and Turel Reklamcilik Tanitim - participated in the tender.

In the end, Che won the auction for $1.325 million.

Che Chairman Ali Kemal Turk pledged $1 million worth of new investments.
 

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