ANKARAÂ – Turkey plans to liberalize its media sector, allowing foreigners to own up to 50 percent of broadcasters instead of the current 25 percent, according to a draft law prepared by media watchdog RTUK and obtained by Reuters on Monday.
The law, prepared at the government’s request and submitted to the prime minister’s office, would open the fast-growing sector to more acquisitions by foreign firms, deterred by having to seek 75-percent partners.
The current law was an obstacle in last December’s sale of media firm ATV-Sabah, bankers and analysts said.
After several foreign companies showed interest, the company was sold to local conglomerate Calik Holding for the minimum auction price of $1.1 billion.
Now foreign firms or individuals would be allowed to own up to 50 percent in one broadcaster and up to 25 percent in a second. Foreigners would only be allowed to have partnerships in two radio or television firms.
A maximum of 49 percent of radio and television companies would be allowed to float on the stock market, the draft shows.
The pro-business AK Party tried to reform the law on foreign ownership in 2005 but the bill was vetoed by the former president. Current President Abdullah Gul is a former member of the AK Party and has a track record of approving legislation passed by the AK-dominated parliament.
Turkey’s fast-growing media sector is dominated by Dogan Yayin Holding, which has around 40 percent of the Turkish ad market.
Dogan Yayin has sold minority stakes in its units to foreign partners and expects to continue doing so this year, as it seeks a minority partner for its digital platform D-Smart.
In 2006 it sold a 25 percent stake in Dogan TV to Axel Springer in 2006 and a 22 percent in newspaper firm Dogan Gazetecilik last year.
There are no limits on foreign ownership of papers.
The second largest company is ATV-Sabah, which is made up of assets seized by a state body from the Ciner Group last year.
Third largest is the media business of unlisted conglomerate Cukurova.
Some analysts and bankers have said Cukurova could be waiting for the law to change before selling a stake in its media assets, which include entertainment channel Show TV and pay-TV firm Digiturk.
A young population, coupled with annual economic growth seen around 5 percent makes the Turkish media market attractive to investors. A population of more than 70 million speaking the same language is also a plus for advertisers, analysts say.
Companies which expressed an interest in ATV-Sabah included News Corp. and Europe’s largest commercial broadcaster RTL. News Corp has already bought into the Turkish media sector, as has Germany’s Axel Springer and Deutsche Bank.