Turkey's Yildiz says conscience clear as investors fear crackdown (updated)
14/11/2016 15:02
* Food producer calls one media report unacceptable
* Shares in listed Yildiz companies sharply lower
* Crackdown follows July coup attempt
(Recasts with chairman's comment, adds forex, updates prices)
By Birsen Altayli and Daren Butler
ISTANBUL, Nov 14 (Reuters) - Turkish food producer Yildiz
Holding on Monday said its conscience was "clear" and its
businesses "clean", after reports suggesting it was the latest
target of a government crackdown sent shares of three of its
group companies tumbling.
Yildiz, which calls itself the largest food manufacturer in
central and eastern Europe, the Middle East and Africa, owns a
portfolio of international brands including Godiva chocolate and
McVitie's biscuits.
It also has ties to other international firms, including a
joint venture with Japan's Nissin Food 2897.T selling instant
noodles.
Shares in three of its companies - biscuit maker Ulker
ULKER.IS , investment fund Gozde Girisim GOZDE.IS and food
wholesaler Bizim BIZIM.IS all fell more than 10 percent at one
point on Monday, and the lira currency weakened.
"To the attention of our valuable investors: There are those
who are making a fuss for no reason. Our conscience is clear,
our work is clean. We continue to work," Yildiz Chairman Murat
Ulker said on Twitter.
Following an article in the pro-government Sabah newspaper,
analysts cited concern that Yildiz was next in line in the
purge, in which more than 110,000 people have been sacked or
suspended and more than 36,000 arrested.
The article did not name Yildiz, but alleged a link between
an unnamed company and a group previously seized by authorities
over suspected ties to Fethullah Gulen, the cleric Ankara blames
for a failed July 15 coup.
Market participants said the unnamed company was widely
believed to be Yildiz. "(The) article which appeared in Sabah
daily might have caused the sharp sell-off," brokerage TEB
Investment said in a note to clients.
SHARP SELL-OFF
In an earlier statement, Yildiz said a news report had
targeted the group's companies, adding it had "nothing to do"
with such an investigation and calling a second report on news
website odatv.com "unacceptable".
Investors continued to sell after the denial from Yildiz and
its chairman, although all three companies pared some of their
losses. One foreign exchange analyst said concern about the
report was partly responsible for lira weakness on Monday.
The currency fell nearly 1 percent against the dollar. It
has fallen 11 percent against the dollar this year, making it
the fifth-worst performer among a basket of 25 emerging market
currencies.
Investors have been worried about the scope of the
crackdown, which started in the civil service and then spread to
the private sector.
Turkey blames Gulen for orchestrating the attempted coup,
when rogue soldiers commandeered tanks, fighter jets and
helicopters to attack the parliament and attempted to overthrow
the government.
Gulen, who has lived in self-imposed exile in the U.S. state
of Pennsylvania since 1999, has denied involvement and condemned
the coup.
Critics say President Tayyip Erdogan is using the crisis to
curtail dissent and tighten his grip on power. The government
says the moves are necessary to root out Gulen's followers.
The Yildiz companies were the three biggest percentage
decliners on the BIST 100 index .XU100 . Bizim fell 9 percent,
Ulker dropped 8.4 percent and Gozde Girisim lost 6.3 percent.
The index lost 0.8 percent by 1446 GMT, with Bizim the biggest
drag.
(Additional Reporting by Akin Aytekin, Behiye Selin Taner and
Ece Toksabay; writing by David Dolan; editing by Andrew Roche)
((daren.butler@thomsonreuters.com; +90-212-350 7122; Reuters
Messaging: daren.butler.thomsonreuters.com@reuters.net))
Keywords: TURKEY YILDIZ/