Status Update

Jun 26, 2020

Ladies and gentlemen, thank you for standing by. I'm Myrtle, your Chorus Call operator. Welcome. Thank you for joining the Turkey Wealth Fund's Global Investor Conference call on the Turkcell transaction. At this time, I would like to turn the conference over to Can Savasan, Vice President of Investments. Please, Mr. Savasan, you may now proceed. Thank you, Myrtle. Good afternoon, everyone, and welcome to Turkey Wealth Fund's Global Investor Conference on the Turkcell transaction. I would like to remind you that if you're joining on the phone, you can find the presentation online on our website, www.turkcellforthefuture.com. Today's speakers are our CEO, Mr. Zafer Sönmez, and our Chief Investment Officer, Mr. Çağatay Abraş. We have a brief presentation first, and it will be followed by questions and answers. I hand over to Mr. Sönmez. Thank you, Can. Hi, everyone. This is Zafer. I am the CEO of Turkey Wealth Fund. I will start my presentation by introducing Turkey Wealth Fund in a nutshell and then continue with the details of the transaction. If you can refer to page three, you will see a snapshot of Turkey Wealth Fund. As it is mentioned, actually, the fund is established in 2016. We are quite a relatively young institution. In the meantime, Turkey Wealth Fund is the strategic investment arm of Turkish Republic, so our mandate is to deliver the strategic agenda of Turkey. As you will see in the mandate, actually, our mandate has an eight-step approach in a house chart format. First, we want to enhance the value of our portfolio companies, and we would like to deliver the strategic investment of the Turkish Republic. We would like to make equity investments that caters for Turkey's international economic objectives. We do investments to reinforce and deepen the financial markets in Turkey. When you look into actually the mandate, basically, the second pillar serves for the investment to Turkcell. It's a new investment for us, and it's a strategic initiative. In delivering these four business pillars, actually, what we do, we have a balanced financing resource. This is both on the equity side and the debt side. We strictly adhere to the corporate governance principles. The fund is fully audited. The fund has a rating. The fund has a fully disclosure on all items. As you can see in this transaction, actually, we wanted to follow a very transparent disclosure mechanism. The deal is disclosed in 13D in New York and actually in the public disclosure platform in Turkey. The other principles we have, we have very high corporate governance principles and also key values like transparency, accountability. As the last pillar of our mandate, we tap to the talent pool of Turkey, actually. That is the most important actually pillar of our mandate. If you look into the financial metrics of the fund, as of 2018, we have actually asset size of $223 billion. This is consolidated and IFRS basis. We have a very diversified portfolio, mainly focused on few main sectors, financial services, energy, transportation, and rest, and telco will be a very significant part of that going forward. Why we are investing in telco industry? We are already an investor in the telco industry, by the way. We have a minority investment in Türk Telekom, and also we own the actual satellite company, Türksat, 100%. That also works in certain areas that in the industry in the cable business. When you look into the last two years actually in the sovereign wealth fund investment strategies, almost over 30% of the investments that are conducted by the sovereign funds are in telco, technology, and digital actually investments. That's why actually Turkey Wealth Fund is following the footsteps of its peers like QIA, like Khazanah, like Temasek, and we are trying to position the fund in the global investors league with high quality, top-notch investments. Moving on to the next slide. Actually, as you know, there is a very famous quote, "Simplicity is the ultimate sophistication." That is the motto of this transaction, actually. When you look into the corporate profile of Turkcell, what you see is a four-layer corporate structure in a very complicated and in a very cumbersome way. Not only the corporate structure is complicated, actually, the shareholding relationship and the disputes in the last 15 years actually became a huge barrier in terms of value creation at Turkcell. The motivation for us coming into the picture as a white knight is not just investing in a company that may create value, but also serve to the strategic agenda of Turkey and make a consensus deal while all parties entering into the transaction, exiting the company has actually good taste. We would like to clear the sour taste in the mouths of the investment community, the investors, stakeholders, and everyone. Also we would like to bring a positive picture for the consumer outlook as well. Because Turkey, for the competitiveness of the country, we want the sector to be competitive and we would like to take the barriers in front of the company to another place so that the company can attain the value creation roadmap. When you look into the corporate structures, as you know, in a nutshell, the company is listed, 49% is trading in Istanbul and New York Stock Exchange, and 51% is controlled by SPV, a holding company, Turkcell Holding. If you look the upper structures, see-through ownerships are important, but it is very complicated. The Telia Company has a see-through actual ownership of 24.02, LetterOne has 13.22, and Çukurova Holding has 13.76 ownership in the company. The problem with this, actually, nobody has a direct stake at the listed company. That creates a huge problem in the shareholding structure. As you see the brief story of Turkcell, I would not go through that, but what you see is actually, I think the period between 2011 and 2015 shows us the bottom line of the problem. No shareholders meeting for three consecutive years and no dividend distribution for four consecutive years. After 2013, actually there is kind of a stepping through the capital market support, appointing board members. Actually, what we wanted to achieve here is not an implicit situation, but a very explicit situation, so every investor knows what it's controlling and what the structure is. Moving on to the next slide. What we offer is actually simplicity. This is a unique opportunity for a positive result to all stakeholders. Very clear structures. The publicly traded shares is 49% and Türkiye Wealth Fund invest in the company in the tune of 26.2%, where there are two set of actual shares. One is a privileged share, 15%, and the other one is ordinary shares, 11.2%. Through this, what we achieve? Actually, first of all, Çukurova Holding is exiting the company, and the Telia Company is also exiting the company. That is two investors, our two founders are exiting the company. It's a very important situation. LetterOne, as the current investor, is significantly increasing its shares from 13% to actually almost 25%. It's almost doubling up its shares. This tells us one thing. LetterOne believes in the company and invest further, and Türkiye Wealth Fund is coming to the structure with the privilege rights without a shareholders agreement, has a clear control for appointment of the board members, which I will go through in the next slides. The outcomes of this transaction on the right-hand side, I touch upon certain details, but let me go through the major items. First of all, from a 4-layer complicated structure, we are collapsing to single-layer structure, clean. The other one is, I think, one of the biggest problems in this story is the shareholder disputes. What we are doing here, everybody is putting the gun on the table and through an escrow mechanism in Citi, London, we put all the agreements in an escrow mechanism, and everybody is releasing its rights for a temporary period on the shareholder disputes. Subject to the closing, these disputes will be all settled. That is very important. We give a break period. Everyone agrees on an escrow mechanism. The escrow is important because escrow creates trust. That is very important, and escrow is in a neutral location in Citi, London, and it also gives us a fast execution capability. That is very important. We are increasing the size of the board from seven to nine, and TWF gains a board control through appointing five out of nine directors in a very clear format. The format is the privilege rights. Every 1%, every one share out of 15 has a right to vote for six. Basically that gives you right to appoint five board members at the general assembly to the board. That is important. When you look into the monetary terms of the transaction. There are several SPAs in the transaction. The kickstart is through the acquisition of Telia Company shares at the Turkcell Holding. What we do, we break down Turkcell Holding structure into several SPAs. The first transaction is through the acquisition of Telia Company shares at Turkcell Holding. The acquisition price for that is $530 million. Actually through several transactions in the meantime, what we do, we acquire Turkcell Holding through an SPV, we merge it, and we give back certain shares to LetterOne, so that LetterOne and ourselves share the Telia Company shares in the company. There is a split between us. Through a series of transactions, actually, we acquire 26.2% of the company, and Telia Company acquires 24.8%. When you look into the other situation, Çukurova exits, and the end result is simple, enhancing the corporate governance of Turkcell, which is a big problem for the growth and value creation of the company. Continue to the dividend policy of the company. This is our commitment. This is very important, and we also mentioned this in our public disclosures and media statements. Not only us, actually other parties are also complying with that. We would like to be an active investor at Turkcell with a view to continue on the performance-driven, valuation-driven approach. We will be managing Turkcell in a modern way, and that is in line with the DNA of this company. That is very important because we are an investor, an equity investor, and as an equity investor, as a strategic equity investor, we not only look into the strategic agenda, but also financial agenda as well. That is very important for us. Not only us, even though there is no shareholders agreement between us, we are aligned with LetterOne for value creation roadmap of Turkcell. That is very important because LetterOne is also almost doubling up its shares in this company, which means as a strategic telco investor. Turkey Wealth Fund is already an investor in telco industry through Turkcell and through a minority share at Türk Telekom. On top of that, we are teaming up with LetterOne, that is already an investor in the company, that is a strategic telco investor and a digital investor. We are joining forces for value creation at Turkcell. That is very important. When you look into the actual situation from a minority perspective, that is the beauty of the transaction in my view. First of all, independent board members will be independent board members. There is no need for an implicit situation at the board. Turkey Wealth Fund has a clear control. Independent board members will be compliant with the independent board members. That is very important. Capital markets step-in situation will be clarified and will be rolled back. That is important. The other one is for the minority shareholders. For the minority shareholders, actually, there is one seat available out of nine. For Turkey Wealth Fund, we are welcoming quality board member for that specific seat because value creation not happens through your perspective. It's a consensus situation actually. That is why we are welcoming quality discussions at the board level. This is our perspective as an investor. Moving on to the next slide. Hands on heart, no surprises. Situation gave a big alpha growth for Turkcell in a very short period of time. This shows us one thing, future is even brighter for Turkcell. In a very short period of time, what we have seen, actually almost 13% as of today, upside in share price in Turkish lira terms. When you look into the not local media, let's check the international media, the messages are all positive actually. No surprises because we all knew that this would be the outcome. This is a transaction that is not helping one party in spite of others. Actually, on the contrary, it is a very stakeholder, shareholder, and market-friendly transaction. Another point which I mentioned, but I would like to underline once again, it is fully transparent. What we achieve here is full transparency and disclosure. Let me tell you, there were 19 law firms in this transaction. It is such a complicated situation. You deal with several jurisdictions, Turkey, New York, Ukraine, Belarus, Northern Cyprus, and so many jurisdictions in the sponsors arena. That is why you have to disclose everything. There is full disclosure on 13D filing. There's full disclosure on the public disclosure in Turkey, public disclosure platform. Also what we wanted for yourselves to understand, we establish actually a website. We are updating that website on a continuous actually effort. We are also working with Georgeson so that they have a long-standing relationship with yourselves, with the industry, and they're also helping us for the right messaging to the market, because there are so many merits of the transaction for the future value creation of Turkcell. Moving on to the next slide, page seven. Actually, a short indicative timeline. These are indicative, that's why we didn't put specific dates. What is happening right now, let's say, desktop clearing. We are working on certain work tracks before the initiation of BVI injunction. BVI injunction is very important. Why? This 6-10 weeks period. There are ongoing lawsuits in British Virgin Islands. The injunction is like a holiday period. Everyone says, "Let's give a holiday period, put everything into an escrow, and follow the actual process up until closing." There are antitrust applications and approval processes going on in several jurisdictions, Turkey, Ukraine, Belarus, and Northern Cyprus. There are local regulatory approvals. These are on track as well. You need roughly actually 8-12 weeks from now up until the convocation of the annual general assembly date. Once we get all legal and regulatory clearances, these are not under our control. BVI injunction is independent, actually a court, we are already in contact with them. It is not just we are starting right now, there were already some messaging through all parties. The beauty of that, it is in a consensus. It is not us only, but all the other parties coming together, applying in those three major work tracks. Once every legal and regulatory clearances are satisfied, we call for the General Assembly. In Turkish law, you need three weeks to make the General Assembly. At the General Assembly, we are introducing a new articles of association. There are certain amendments in the articles of association, as the agenda item in the General Assembly. I will go through that. Once subject to the approval of the general assembly, we roughly have a week or so for the closing of transaction. The longest update for the transaction is 15th of January 2021. Why we set that line? We were in full execution mode during COVID pandemic. There can be unforeseen situation, and we may not be in control of that. We put a buffer time for the longest update. That is the reason why we have that longest update. Moving on to the next slide. This is the general assembly agenda. Out of 15 agenda items, which are customary, ordinary topics. The third is the important one, articles of association amendments. That is important. Moving on to the next slide, page nine. What you see two major differences in the current situation versus the proposed situation. My team put it in a dim color, it is actually colorful today as well. We are actually proposing a situation that will pave the way for the company in a much healthier way, in the best potentially one of the best corporate governance cases. Simple, board seats will increase from seven to nine. Second, Group A shareholder, which we will own, will have five board seats. That is nomination and voting for the privilege. General assembly members will vote for these items. A minor detail, board at the current situation can restrict shareholders' pre-emptive rights. We said we want to be market-friendly. Let's put something that board cannot restrict shareholders. We don't want to dilute with the board decision. Let's put it as a general assembly item. This is another market-friendly approach. Meeting quorum, almost the same. What we are changing decision quorum to be five, because we have five. That is the simple thing. General assembly quorums, as you know 51/51. Meeting quorum, almost the same. Decision quorum, majority. You will see almost this item is the same. Termination of event of the privilege actually. When all group shares are not owned by a single shareholder, that will be a termination event. We are not in a motivation to split our situation and bring another complicated. That is not the intention. We are a long-term investor at Turkcell. We are a strategic investor, and also we are a financial investor. We have two hats driving this transaction. Moving on. Board structure, as you see, which I told, in the current situation, there are several shareholders' agreements, SHAs. This company is actually a graveyard of SHAs, unfortunately. What we are doing, we are clearing that. Simple. We are putting a privilege to appoint five board members to the board. Simple. No shareholders' agreement. Three independent and one seat for the minority. That is important. We don't have any motivation to block that minority seat. We are welcoming quality discussion that will help for the value creation of Turkcell. Moving on to the next slide. Actually, I'm talking about the privilege. Let me dig further on what the actually privilege is. As I said, we have a privilege for the election of five out of nine board members at the board. Second, election of the chairman of the board, because chairman actually determines the agenda of the board meetings. That is important. Election of the chairman of General Assembly, it's a courtesy role, so it is not very important, but for courtesy as the leading shareholder, we wanted that seat as well. We don't have privilege on certain items. No privilege on the election of Board members, including independents. No privilege on changing the dividend distribution policy. We don't have that. Any other shareholder matters. For the General Assembly items, we are actually regular investor for our 26.2%. That is important. That gives a lot of actually motivation for all the minority shareholders going forward because we have one share, one vote principle in that regard. That is important. We give a lot of, let's say, a lot of importance for the voice of the minority rights at the company. What we provide in the corporate governance improvements, actually, the summary is mentioned at the right-hand side, but in a nutshell, actually, it is what I mentioned in the boxes. Moving on to the next slide. As you guys all know, dividend payout is a very important metric for an investor in a company. Especially for a listed entity, that is very important. We are a strategic investor. However, on the other hand, we are also a financial investor. As a financial investor, we are motivated to rely on the dividend yield of Turkcell in a very, let's say, meaningful way. That gives you a commitment to stick to the dividend policy. What we say, TWF has agreed to support existing dividend payout policy of minimum 50%. That is important. Turkcell management should create a delicate balance between value creation and shareholder value. The company will invest, but also the company should be motivated to distribute dividends. That is very important. That's why we will be an active investor at the Board following up on those policies. On the page, you see pink colored actually periods. I think everybody knows what the situation is. These are the eras of disputes. The company could not even convene a Board, convene the General Assembly. A lot of situations that we all have to forget. In this current situation, those problems are all ironed out. No, let's say, potential disputes going forward. Turkcell value creation. First of all, I would like to say I'm not a telco guy. We are kind of an investment holding company invested of the sovereign as a strategic investment arm. We have so many investments in so many cases. We are nothing different from our peers like Temasek, like Khazanah, like QIA, like PIF, and then several others. We are strategic investors, and we would like to welcome the value creation roadmap of Turkcell, which is already in place. The picture is from the investor presentation of Turkcell. We are not reinventing what Turkcell has been doing since its inception at the best practice. What we are doing, actually, we are taking the barriers out of the management scope so that the management can focus on value creation, and we, as the board members, can be complementary to the management strategy. That is very important. That is the message I would like to give. As you see, the management has put a very credible roadmap for Turkcell. Turkcell is not a mobile operator anymore. Turkcell is a digital services company, digital business solutions company, digital technology financing services company. In my view, you have four or five Turkcell inside Turkcell. What is happening is a huge discount at the company due to several reasons. Complicated shareholding structure, complicated governance, complicated situation in a world-class asset. Actually, Turkcell doesn't deserve this. What we believe, we are not reinventing a strategy for Turkcell. We will stick, and we will be complementary and helpful for creating a value creation agenda for Turkcell. It is already in the DNA of Turkcell. If you look into the global transactions that have been done in the last few months, I would not mention the location, but it's in east of Turkey, a very big country. Certain companies are already looking to Turkcell as a role model. What we say, Turkcell has seen $25 billion value at the peak. When at the IPO, it was $17 billion. That is not a dream anymore, because Turkcell, in the meantime, has successfully implemented a huge digitalization agenda, and it's already underway. What we are bringing here, okay, let's break the chain for delivering the value creation agenda. Let's break the mold for Turkcell. People in the minds were saying this will not be settled. What we are saying is anything is possible, and Turkcell has all the human talent, intelligent thinking, and actually execution capacity coupled with the financial power, Turkcell can deliver this agenda. What happens, moving on to the next slide, 14th slide. What happens if the general assembly doesn't vote positively? It's up to the general assembly actually members. The deal is still conditional. If we have a negative voting at Turkcell general assembly, parties will go to status quo. What is the status quo? It's 15 years of fight. 15 years of fight will accelerate because there will be a huge disappointment, and parties will be in a huge defensive mode. Second, there will be dividend uncertainty for the shareholders. Why? Because history tells us. We are not fortune tellers. We are just looking to track record of the shareholders' attitudes. We can also easily say a unique opportunity would be missed. This is the most elegant way of solving the problems at Turkcell, but it is not our single motivation. This is the most credible way of value creating at Turkcell. Having spent my last 15 months, and together with my team, I am 100% convinced this is the most elegant way and the most credible way of solving Turkcell's problems, and helping Turkcell to achieve the value of its peers, where its service quality is at a superior level compared to its peers. This is unfair to Turkcell. This is unfair to this company. My last comment we have on the last page, we have some contact information, and my team and Georgeson team is at your disposal for addressing your question. In this investor meeting, actually, I would like to also take questions. The moderator will get the questions one by one. Unfortunately, for every party, we have one question quota. Apologies for that. We want to spend more time, but this is already coming to end of business day in Turkey. That's why I would like to give a chance to all the team members to spend some time with their families for the weekend. Thank you. Ladies and gentlemen, at this time, we will begin the question and answer session. The first question comes from the line of Kim Ivan with Axilius Capital. Please go ahead. Yes, good evening. Thank you very much for doing this call. I was wondering, what are Turkey Wealth Fund long-term plans for this stake? Do you plan to reprivatize it, or your plan is just to hold it indefinitely? Thank you. Thank you, Ivan, for the question. I appreciate that's very important topic for us. In a nutshell, TWF will be the controlling shareholder of this company. We would like to continue on delivering company strategy, and we don't want to change any strategy going forward. We will be complementary for value creation. That is very important. We are working and helping on value creation agenda. Actually, we would like to maintain best-in-class corporate governance at the company. Türkiye Wealth Fund will not be focusing on day-to-day agenda. This is not our strategy. We are active shareholders at the board level. Moving on, this is a strategic stake for us, so it is not a financial stake only. What we say actually, we are a medium to long-term investor at Turkcell, so we are not short-sighted. As our peers in other countries, for example, I work for Khazanah Nasional in Malaysia. When looking to Khazanah, actually they are investors at several telco companies. They are looking for a longer horizon. Moving on, what we want to do, we would like to work with LetterOne as the remaining shareholder for value creation, and we would like to listen the minority shareholders and get their views, and we would like to open more room for the management to deliver this strategic agenda, because the strategy and the management is already capable, and they have a plan. What we want, we would like to be complementary to that, help for value creation. I hope this is clear. We are seeing ourselves, we are perceiving ourselves as a medium to long-term investor at Turkcell. Yeah. Thank you very much. Thank you, Ivan. The next question comes from the line of Ece Mandacı with ÜNLÜ Securities. Please go ahead. Hi. Thank you very much for the presentation and opportunity to ask questions. You have emphasized that Turkcell is undervalued, and it's important for you, the value creation in the company. Could you please share your thoughts on potential strategic partnerships under Turkcell, such as potential infrastructure sharing or establishment of a infrastructure fund, before any potential investment in 5G or any strategic partnerships or IPO of potential assets under Turkcell? It would be really helpful. Thank you very much. Actually, I think it is not just my view that Turkcell is undervalued. When you look into, for example, India, what we have seen, Facebook, through its certain syndicate, very credible investors, they invest in Jio. Check the valuation of Jio, which is a Reliance entity in India, and compare it with Turkcell. What you will see, there is a big delta in terms of value between two companies. However, I can convincingly tell you that Turkcell's proposed strategy and business units and strategic agenda is superior to what we have seen in a peer. What we are saying actually, in Turkcell you see several companies. You see a mobile operator, you see a payments company, you see an infra company, you see a technology finance company, you see a digital company. You see a consumer business. Actually, what we want, Turkey is lacking big time in terms of technology. There is no unicorn in this country. There is no, let's say, big investors in the digital space. What we see, Turkcell, we are proud of investing in a company that has a name starting with Turk. This is the country's company. That is very important. On top of that, we are investing in technology, not a mobile operator anymore. It's technology, it's digitalization, it's payment system, it's telco infrastructure. What you will see, you have to look as an analyst to Turkcell as sum of the parts and value this company with the peers and find the total sum. Compare it with the current market cap, you do a bridge analysis. What you will see in the next few years, let's unlock this value one by one by one by one. You will arrive at a valuation that even the people on my table and your side will be highly surprised. What I may add on top of it, Mr. Sönmez's addition, is that your potential infrastructure company is the design of a telco industry in Turkey. Turkcell is one of the leading operators in telco business. The infrastructure play should be well-defined with the Ministry of Transportation and the government's view on 5G CapEx plan. Turkcell will be closely monitoring this CapEx plan on the 5G, and this will certainly be a very dominant position. It's not only Turkcell's discretion to decide the design of the market. That is why we are leaving the valuation, the value capturing plan of Turkcell. This might, at the same time, include, as mentioned by yourselves, through some IPOs of some potential assets as the sum of the parts play, which Turkcell tried to achieve it in the previous years, as we all know. Çağatay, thanks a lot. I think we have to be clear on this one. A market transaction, either IPO or a trade sale, whatever the situation is, we have to focus on value creation first. There is no urgency for us to do something on it. Why? Even the signing of a transaction gave us two days of 10% upside. This tells us one thing. We have to walk our talk. If we walk our talk and we put a narrow gap between our walk and talk, that will be achieved. You will see so many exciting stories around Turkcell going forward, what I can promise to yourself. Thank you, Ece Hanım. I hope this is enough and satisfactory for yourself. Thank you very much. The next question comes from the line of Alexander Vengranovich with Renaissance Capital. Please go ahead. Yes, thank you very much for your presentation. My question refers to the rights of minority shareholders. Can you please clarify, is there any chance that as a result of this transaction, minority shareholders will have a right for a mandatory tender offer for their shares? Or if not, then just confirm it. Thank you. Let me address that. It's very simple. The minority rights don't have a mandatory tender offer right. The situation is as such, actually. First of all, Türkiye Wealth Fund is immune from the capital market supports regulations, so by its law. Actually, what we are actually proposing here is Just a second. We want yourselves to note that shareholders will be asked to opine on the deal through AGM vote on the articles of association amendments. That will require approval of two-thirds of the attending shareholders. For the mandatory tender right, there will be no trigger for the minority rights to claim a mandatory tender offer. Also, you would like to note, I think another point to the MTO rights, there's no exit rights as well under this transaction. By law, there is no MTO and exit rights for Turkey Wealth Fund and the parties acting in concert with Turkey Wealth Fund. Thank you. It's clear. The next question comes from the line of Hafizoglu Erdem with BGC Partners. Please go ahead. Hello. Thank you for the presentation. If Turkey Wealth Fund would be interested in acquiring Türk Telekom as well, so it has some partnership in that company, and the banks are also willing to sell it. Are there any obstacles after the Turkcell deal in terms of competitive point of view? The second question, if I may, what was the condition for the purchase of Çukurova shares? How much the Wealth Fund or the Russian partners have paid to either Çukurova Group or Ziraat Bank in that sense? Thank you. Erdem, very much thank you. I would like to show you a red card for the second question because you don't have a right, but I will address that. First of all, actually I'm just kidding, by the way. First of all, on Türk Telekom, we are already investors. We are roughly 7% investors. As a party to Türk Telekom, government is already holding another 25 through the treasury. You would like to note that. We look into every situation in silos. In Türk Telekom, we are a shareholder already, and we welcome any activity there. For investing activities, that is not on our plate. For Turkcell, we are focused on delivering the strategic value creation agenda for Turkcell. We see telecom industry as a very strategic and a key sector for Turkey. That is why we are now having a full focus and having a wider lens for the telecom industry through Turkcell controlling share, through minority share at Türk Telekom, through 100% ownership at Türksat. Why it is important? Because we are the strategic investment arm of Turkish Republic. We have to align certain interests around the telecom industry, and it is not in spite of any other players. That is why we will be complementary for delivering agenda for Turkey. On a specific note for Turkcell, we will be an active board member at Turkcell board. That is the differentiating factor for that. For the second question, what was the condition for the purpose of Çukurova shares? Okay. When you look into that, actually, if you just acquire Telia shares, you wouldn't be able to resolve all the disputes. I think we should connect the dots here. That is why it is a series of transactions that is ending in a simple org structure for the company. I think you have to note it. If we were just telling you this situation, we are acquiring TD shares at the SPV above Turkcell Holding, that will not be helpful on its own for resolving 15 years of story. For completing the chain, the loop here, you have to clear everything. You have to bulldoze all the layers. In achieving so, what we are doing actually, we are basically assuming the debt for the Çukurova Holding and taking them out of the structure in a crystal clear manner. I hope this is clear. We are assuming the debt, it's their current debt, and we are taking them out completely. For us, if you look into the consolidated picture, the debt sits on our subsidiary, Ziraat Bank, which is 100% TWF entity. We are not doing another financing around this. It's already in our consolidated books. You have to note that important piece. That is why we acted in an instrumental way to resolve all this situation. For achieving that, you have to bring all the parties. That is why that was the purpose of acquiring Çukurova shares. I hope this is clear for your side, you have to complete from start to the end a series of transaction to bulldoze all the complicated shareholding structure. Basically, we are taking Çukurova in a very elegant way, they are not obliged in terms of Turkcell situation anymore. They don't have any liability going forward. We are simply assuming their situation, which is already consolidated in our books. Thank you. Just a small question, if I may. The Russian partner is increasing its stake. Did they pay anything in that picture or did that cost something to them? Adam Bey. It is the third question. If you call me privately, I will answer that. I will provide my phone to you later on. Thank you. The next question comes from the line of Demirtaş Cemal with Ata Invest. Please go ahead. Thank you for the presentation. My question is related to the Russian transaction. Do you know how much they paid and any detail about their conditions? Your Eurobond issues attempts, what are your plans in terms of financing? Thank you. Cemal Bey, I was 100% that this question will be repeated. That's why I don't want to leave it open. Thanks a lot for addressing that. Actually, it's in the web already. You can refer to 13D filing, you can refer to public disclosure, KAP, and also you can refer to Turkcell for the future. Let me give the details. There are several transactions, but I will tell you the net investment. There is a gross investment, but you don't have to look into that. Roughly $150 million-$155 million of investment will come from Turkey Wealth Fund. The remaining 380, roughly, I'm rounding up the numbers, will come from our shareholders, partners, LetterOne in this transaction, through a loan note structure. What we do actually, we pay to Telia, as Turkey Wealth Fund, $530 million out of which 150 roughly will be funded by Turkey Wealth Fund. The remaining part will be funded by LetterOne through a loan note structure. I hope this is clear. You can check the details. If you have questions, we will be happy to address that through the contact details. The Eurobond. Thank you. The Eurobond. There's a hidden question in the question. Second one. Eurobond issuance is not related with this transaction. Eurobond, we disclose to the market 20 months before. It's been 20 months for us in this role, for me in this role with my team. Turkey Wealth Fund will tap to the Eurobond market similar to our peers. Likes of Temasek, PIF, Khazanah, others, they are all coming to the Eurobond market. Why? Because there's a global investor base for sovereign wealth funds. This is a sub sovereign cluster. We are not cannibalizing any market. We are actually expanding the bond market for Turkey in a different cluster. We will be tapping into that territory as a regular bond issuer because we wanted to establish long-term relationships with our investors. In order to achieve that, in the last 20 months, Turkey Wealth Fund has completed its audit process. You can check our financials at our website. KPMG is our auditor, and we are a rated entity already by Fitch. We don't have any obligation to complete a rating right now, but we completed it, I guess, in April, after a work of six months, because we said we have to comply with governance standards. We want to establish a transparent, accountable entity. For the bond, it is for our general investment activities. It is not related with Turkcell. Turkcell transaction funds are in place. We are not looking for funding for Turkcell. Bond process is separate. We will be tapping to the market as a regular issuer, and we would like to establish long-term relationships with our investor base. You have to separate two topics. I hope it is clear, Alparve. Oh, sorry. Thank you, Zafer Bey. Congratulations, by the way, for this transaction. I hope this transaction will have good prospects, because there were questions about the Wealth Fund, whether it's going to be successful or not. I think, personally, I could say that it's a good move, at least, very significant move. It could open the way for re-rating of Turkey. I think it would be a catalyst. We are closely following your operations and success and wish you the best. I think it's going to be essential for the re-rating of Turkey, if it's going to be possible. Thank you. Thanks a lot, Cemal Bey. We highly appreciate. Any country that is committed to establish a fund, a sovereign fund, either a wealth fund or asset-backed development fund like us, if there is commitment, if there is capacity, and if there is talent, the result is no-brainer. Turkey Wealth Fund will be at par with its peers, if not better than them. Thank you. The next question comes from the line of Alper Ozdemir with Ak Investment. Please go ahead. Hello. First of all, congratulations for the deal. As far as I understand, LetterOne may consider selling 5% of its Turkcell shares in the first year after the completion. Is there a rights of first offer here in the agreement between you and LetterOne? Also, can you please give us some details about the lock-ups? Thank you. First of all, there's no right of first refusal. Second, there's a threshold. In every transaction, there's those kinds of thresholds. It is customary to any transaction that is in that sophistication. There's a lock-up period for LetterOne, actually, and ourselves as well. That is important because you have to put a lock-up period for value creation. You should note, I think that our LetterOne colleagues are on the line as well. Going forward, the market should look into this. There should be a value creation at Turkcell. That is the ultimate motivation of two parties. The 5% threshold and lock-up periods are very customary to any transaction in that capacity and in that complexity. I hope it is clear. Yes. Thank you. Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to Turkey Wealth Fund for any closing comments. Thank you. Thank you, everyone. We highly appreciate for yourselves attending to this conference. This is very important for us. I would like to mention once more, Turkey Wealth Fund is a strategic investment vehicle for the government. That is important. What we want, we would like to establish a mutually beneficial relationship with the investment community. That's why, in order to achieve that, we are implementing a fully transparent and fully actually credible and accountable messaging to the market. We are at your disposal. If anything that is not clear, please approach to our team, our contact email, or to Jordson anytime. We are very happy to make further clarifications. What we want is we want a deal that is fully transparent. That's why we followed every disclosure requirement in this transaction with our legal advisors, with our team. Thanks to our partners, Telia and Çukurova, that are exiting the company. Also big thank you to LetterOne team as well. Actually, it's a full team effort on every footstep of this transaction. I would like to thank everyone once again. Have a nice weekend, and take care of yourselves.