The Shareholders Association (BORYAD) supports Doğan Group’s decision, calling it a confidence-increasing move, a common practice in international markets
The Doğan Group has announced that it will buy a further 5 percent stake in Petrol Ofisi (POAŞ), a company in which it already had a stake of over 50 percent, in a move interpreted as an effort to raise investor confidence.
In a statement to the Istanbul Stock Exchange (İMKB) the Doğan Group strove to defend itself against what it termed “unconfirmed and groundless claims” directed at POAŞ. Adding that these “symbolized a strategic initiative … in the Turkish economy as well as the world, causing the company a market positioning it did not deserve and prompting unnecessary damages to the investors in the company.”
It went on to say that within the light of these developments, the executive board has convened and evaluated the situation. “Doğan Holding, as it has always done, is determined to closely monitor, support and supervise this subsidiary of ours in its operational and financial matters. As a sign of our group’s trust and belief in the future of this subsidiary, the Office of the Holding Coordinator has been authorized to buy from the İMKB secondary market shares equivalent to a 5 percent stake in POAŞ within six months starting from the date of announcement.”
In this context, shares with nominal value of YTL 372,763, translating into a 0.09 percent stake of POAŞ, were bought on Friday for an average price per share of YTL 4.97 by paying a total of YTL 1.85 million.
With Friday’s purchase, Doğan Holding’s share in POAŞ has increased from 52.73 percent to 52.82 percent. The statement noted that the executive board’s decision did not affect any of the contracted commitments of the company.
The announcement that the Doğan Group was to buy further POAŞ shares was a confidence-increasing move, according to the Turkish Shareholders Association (BORYAD).
“The confidence of small investors will surely be boosted by this decision,” BORYAD Executive Board Member Soner Bahçuvan said. Supporting the decision of Doğan Group, Bahçuvan also said that capital markets would have a positive impact if other holdings were to buy shares in subsidiaries traded below their values.
By buying POAŞ shares, Doğan Group was increasing the value of its company, Bahçuvan underlined. He added that similar moves were common practice in international markets.
It was a perfectly rational move for a dominant partner to buy the shares of its company in times when market vulnerabilities increase and valuations decrease, Bahçuvan explained, just as when shares of the company were traded over value it was perfectly normal to sell.
The TDN is a Doğan Group publication.
Shares in POAŞ (percent)