BeST

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In July 2008, Turkey's leading mobile phone company, Turkcell, signed a sale and purchase Agreement to acquire 80 percent of Belarus's state-owned mobile operator for US$500 million. At the time ofthe sale, BeST,Belarus was third largest mobile operator with 187,000 subscribers. The company started operation in 2006. According to the agreement, Turkcell had to pay to the government US$300 million within 30 days after signing the contract, and $100 million a year in 2009 and 2010. Turkcell also agreed to pay another $100 million when BeST shows a net annual profit for the first time. A multi-year $500 million capital expenditure commitment was also made. The Belarus government committed to retain the remaining 20% stake for the next five years. The transaction was a negotiated sale. The government announced its decision to sell the majority stake in the company at the end of 2007. At that time it was reported that the company failed to meet the 2007 target for subcriber base and faced a difficult financial situation. BeST had a credit debt outstanding to China that amounted to USD 234 m. However, this amount was discounted from the final price paid for BeST’s privatization due to legal changes. Consequently, the amount actually received for 80% of BeST shares was only USD 266 m. At the end of 2008, BeST reported 250,000 subscribers. Turkcell made its second scheduled payment to the government of US$100 million on Dec. 31, 2009. Two payments to the government remain to be paid: US$100 million to be paid on Dec. 31, 2010 and US$100 million when BeST reports an annual profit for the first time. Note that Turkcell's US$500 million commitment to invest in facilities, though made in 2008, covers multiple years of capital expenditures. http://investor.turkcell.com.tr/subsidiaries/belarus-best.aspx?o=IstiraklerimizIcAlt01&osa=isi02