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Chinese Banks Are Said to Back Turkey Deal Disrupted by Pandemic


A group of investors from China secured the backing of some of the country’s biggest banks for a $2.3 billion deal to buy a stake in a company operating a bridge and toll roads in Istanbul, according to people with knowledge of the plans.

The transaction, initially negotiated at the end of 2019, hit a snag when the coronavirus pandemic began last year. It’s now been revised to include a commitment by several Chinese banks to refinance $1.6 billion of the original loan to the bridge operator, said the people, who asked not to be named because the deliberations are confidential.

The deal would require antitrust approval and a presidential decree from Ankara to allow a non-Turkish entity to take a majority stake in a concession company, they said. Both sides are confident that Turkish authorities won’t stand in the way of the agreement.

The fresh funding from Chinese banks delivers a signal of confidence for Turkey at a time when many foreign investors have been in shock at President Recep Tayyip Erdogan’s massive shakeup of the top ranks across the country’s key economic institutions.

Lenders from the world’s second-largest economy have meanwhile undertaken a rapid expansion in Turkey by chasing massive project finance deals. In 2019, China’s central bank also extended $1 billion worth of funds under a swap agreement to help its Turkish counterpart boost foreign reserves.

Some of the issues related to the deal in Istanbul might be on the agenda during a visit by Chinese Foreign Minister Wang Yi to Ankara this week, said two of the people, part of a regional tour that included a meeting with Erdogan on Thursday.

Bridge, Roads



Read More: Chinese Banks Are Said to Back Turkey Deal Disrupted by Pandemic

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