Turkey's TAV to sell minority stake in ground handling business

Sani Sener, TAV chief executive, told the FT that TAV would sell a minority stake in Havas, its fully owned ground-handling subsidiary, allowing it "easily" to meet debts of 144 million euros ($192.1m) falling due in 2009.

Total net debt stood at 758 million euro. TAV would also prepare to relaunch a delayed flotation of Havas in 2010, Sener was quoted as saying by the FT.

Havas could be valued at around 275 to 350 million euro, with TAV aiming to sell a 30 percent stake to a strategic partner, according to a banking insider who added that TAV could also seek a partner for its recent airport investment in Tunisia, FT reported.

TAV now runs six airports in Turkey, Tunisia, Georgia and Macedonia; holds rights to operate five more, and is bidding for new projects in countries such as Latvia, Kazakhstan and Abu Dhabi.

But the aggressive expansion has left TAV highly leveraged in a year when Turkish companies could struggle to raise funds from international markets, the report said. The group's market capitalization has fallen from about $2.2bn to $550m in 2008.

PASSENGER NUMBER FLAT

Passenger numbers in Istanbul were flat year-on-year in the first half of January, Sener told FT, a level better than in many European airports, although his forecast that they will grow by 4 percent this year depends on a bullish forecast of 2 percent growth in the wider Turkish economy.

Sener insisted that, in spite of the difficult short-term outlook, TAV needs to be ready for a new wave of airport tenders in a region where infrastructure development has lagged behind growth in air traffic, FT reported.

He wants to convince Latvian authorities that TAV can turn Riga's new airport into a transit hub between Europe and Asia, following Istanbul's model. "We have to position ourselves for 2010," he was quoted as saying by the FT.