Erdogan's Dogan media enmity resurfaces in Turkish referendum build-up

Erdogan's Dogan media enmity resurfaces in Turkish referendum build-up
Dogan daily Hurriyet reports scathingly on sentencing of Erdogan in 1998
By Akin Nazli in Belgrade March 2, 2017

The renewed clashes between Turkish President Recep Tayyip Erdogan and Turkey’s largest media group Dogan Holding have their roots in a row that stretches back to the beginning of the 1990s when Erdogan first emerged in Turkish politics as the mayor of Istanbul. Naturally, the mainstream media, which Dogan’s publications played a heavier role in back then, were against the rise of the Islamist Refah Partisi (Welfare Party), of which Erdogan was a member.

With Erdogan now warning that Dogan flagship daily Hurriyet may be set to pay a “heavy price” for an “impudent” article suggesting there is disagreement between him and the Turkish Army over several issues – and with Amnesty International having on February 28 responded to a Turkish court’s decision to remand Turkish-German journalist Deniz Yucel in custody by stating that the free media in Turkey “is in its death throes” – it is instructive to recall that Erdogan refers to that period as a time of "doing combat with headlines”.

When one year after the armed forces’ “post-modern coup” Erdogan was sentenced to a 10-month prison sentence in 1998 for the recital of a poem which was found to be an incitement to violence and religious or racial hatred, Dogan’s flagship daily Hurriyet announced the jail sentence on its front page. Its piece declared that Erdogan was not “even able to be a mukhtar [village head]”, something which the president has never forgotten.

No doubt his latest battle with the media will have been framed with an eye on the campaigning that remains to be done prior to the seminal April 16 referendum in which voters will be asked to relegate parliament to a minor role and make Erdogan an executive president with sweeping - some say “authoritarian” – powers.

Dogan is one of Turkey’s largest business groups, with interests in media, energy and retail. As well as owning Hurriyet - one of the country’s most influential newspapers - it owns popular TV channels CNN Turk and Kanal D. Dogan is also known as a business partner of US President Donald Trump. They together developed the conjoined Trump Towers Istanbul, a commercial and residential complex in the capital's central business district.

 

'Voice of the establishment'

Erdogan has always accused Dogan publications of being the voice of the establishment and his historical battle with Dogan Media has long been one of the core arguments of his election campaigns. Throughout Erdogan’s years in power since 2003, the Erdogan and Dogan relationship has remained on a rocky path.

Dogan Holding was penalised with a tax fine of TRY4.9bn (€1.26bn) in 2009. The conglomerate went on to sell two of its newspapers, Milliyet and Vatan, in 2011.

The latest row between Erdogan and Dogan erupted following the publication by Hurriyet on February 24 of a news article headlined “Discomfort within Army HQ”. The article looked at military annoyance over seven issues, including not being consulted over the recent move to allow women in service to wear the Islamic headscarf.

Pro-Erdogan media reacted strongly to the piece, mainly due to the headline, which was reminiscent of the times when the Turkish army regularly intervened in Turkish politics by raising concerns in the media over political issues. As the current situation in the country is open to all kinds of conspiracy theories, especially in the aftermath of the military coup attempt in July last year, Erdogan reacted strongly and talked about how “everyone should know their place”.

On February 27, media reports suggested that Turkish prosecutors were probing Hurriyet’s article. Dogan’s share price fell from TRY0.82 on February 24 to as low as TRY0.66 on March 1. Around noon local time on March 2, Dogan Holding’s shares were up 2.86% d/d while the BIST-100 index also rose by a relatively limited 0.42%.

Following the controversy generated by the article, Hurriyet edited the piece and replaced its editor-in-chief.

On February 28, a Turkish court decided that Aydin Dogan, honorary chairman of Dogan Holding, should be summoned to appear in person in the latest hearing on an indictment over alleged Petrol Ofisi smuggling. The Istanbul court accepted the smuggling indictment in March 2016 and the first hearing was held in July.

In January, Dogan’s shares were also hit by news that Turkish police had detained the company’s former CEO Yahya Uzdiyen and its chief legal advisor Erem Tugrul Yucel as part of an investigation into supporters of US-based cleric Fethullah Gulen, who is accused of being behind last year's failed coup. However, Dogan companies gained some ground on the stock exchange later in the month after a Turkish court on January 13 released Uzdiyen and Yucel.

In February, Soner Gedikli, Uzdiyen’s successor in Dogan Holding, resigned. Dogan Holding announced on February 20 that it had appointed Yagmur Satana as the new CEO.

Barbaros Muratoglu, the Ankara representative of Dogan Holding, was detained in January over a suspected link to the Gulenist network.

Dogan Holding Financials (consolidated)

(mn TRY)

end-14

end-15

Total Assets

6,877

7,441

8%

Total Shareholders' Equity

2,910

3,042

5%

(mn TRY)

2014

2015

 (y/y)

Revenues

3,543

5,951

68%

Gross Margin

790

1,027

30%

Operating Income

39

260

560%

Net Income

-225

-161

-29%

source: kap

     

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