Turkcell Files Suit Against MTN In US Courts

Date : 03/29/2012 @ 4:45AM
Source : Dow Jones News
Stock : Turkcell Iletisim Hizmetleri As (TKC)
Quote : 8.82  0.2 (2.32%) @ 3:59PM

Turkcell Files Suit Against MTN In US Courts

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Turkey's largest mobile phone operator, Turkcell Iletisim Hizmetlera AS (TKC), Thursday said it has filed a suit against South Africa's MTN Group Ltd. (MTN.JO) in the U.S., seeking damages related to the award of a license in Iran.

Turkcell alleges the South African company encouraged Pretoria to support Iran's nuclear power development program in 2005, and it claims MTN made improper payments to an Iranian and to a South African government official between 2004 and 2005 to enable the company to secure a license to operate in Iran.

MTN holds a 49% stake in Irancell, Iran's No. 2 mobile phone operator, with the government as its partner. Turkcell lost out to MTN in 2005 in securing the license, the second to be tendered in Iran. Around 21% of MTN's subscribers are in Iran.

"Newly received information by Turkcell indicates that the signing of the license agreement with MTN instead of our Company was a consequence of MTN's actions at that time. In light of the harm caused by MTN's actions to both Turkcell and to its shareholders, Turkcell today filed a lawsuit against MTN seeking the compensation of such damages," Turkcell said in a statement.

Turkcell said it filed the suit in the U.S. because its allegations are that MTN breached "rules of international law."

MTN said it would comment later Thursday.

South Africa's department of international relations refused to comment on the Turkcell allegations, but said that "government influence can't be bought."

"We're not aware of anybody buying influence from the government," a spokesman for the government said.

MTN appointed an external committee to investigate claims by the Turkish operator earlier this year.

The allegations come as MTN's Iranian operation is the target of a U.S. lobby group, which is seeking to persuade foreign businesses to leave Iran. United Against Nuclear Iran in January sent a letter to MTN Chief Executive Sifiso Dabengwa calling for the company to pull out of the country, alleging MTN's technology is being used by Iran's government to locate and track mobile phone users.

-By Devon Maylie, Dow Jones Newswires, devon.maylie@dowjones.com, +27117837848




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