David O’Byrne in Istanbul -

Almost eight months on since Turkey's Kazanci Holding announced that it would sell a minority block of its main energy subsidiary Aksa Enerji Uretim AS to Goldman Sachs, the two companies are still at odds over the details of the deal.

While Aksa Enerji chose to continue to report the sale in its annual operations report on March 13, Goldman opted to maintain the same "no comment" it has been offering since news first broke last July.

News of the sale was broken first on July 25 last year both in a disclosure to the Istanbul stock exchange IMKB, and in interviews given the same day by Kazanci Group chairman Cemil Kazanci.

Two separate deals were mentioned in the IMKB disclosure: the first in which Goldman would lend Kazanci Holding $192m for 53 weeks, with 43.64% of Aksa Enerji shares as collateral, and a second as-yet unfinalized deal under which Goldman would buy a total of 26.47% of Aksa Enerji stock for an undisclosed price. In subsequent press interviews, Cemil Kazanci added that the two sides had agreed a price of "about $450m" for the share sale - a figure which wasn't disclosed to the IMKB until August 5.

Despite Kazanci conceding that the details could change, the announcement prompted what Bloomberg at the time described as "a record gain" in Aksa's shares. When approached for comment by bne, Goldman chose to confirm only the loan, and not the share sale.

When Kazanci announced further details of the - still not final - agreement in October last year, it was clear that what had initially been announced as a simple share sale had become far more complex.

Market climate

According to the disclosures in addition to the agreed loan, Goldman would take around 9.86% of Aksa Enerji through a capital increase for $175m, and in addition would purchase directly 5.24% of Aksa B-type shares for $93m. The complete transaction would leave Goldman with around 15.1% of Aksa Enerji, for a price of around $268m.

Again though, when approached, Goldman declined to comment - confirming only the previously announced loan.

According to an analyst at one Istanbul brokerage, speaking on condition of anonymity, Goldman's reticence to confirm the share purchase is down to the deal having only been provisional, and "market conditions" having changed somewhat over the intervening months. The analyst chose not to elaborate on precisely which conditions have changed, although a perusal of recent news from the Turkish energy sector suggests a couple of candidates.

The first concerns plans by Kazanci Holding to buy several of Turkey's regional power distribution companies, in tenders held in 2010, but the resolution of which dragged on to early this year. With Aksa Enerji Turkey's biggest generating portfolio of 2036 MW, securing a captive market for its power would give Kazanci a significant advantage. But having submitted bids for four of the eight on offer through another subsidiary Aksa Elektrik, Kazanci failed to complete any of the purchases.

They weren't alone; seven of the eight went unsold due to potential lenders considering bids from all bidders unsustainably high.

Kazanci has also faced problems with plans to secure its own sources of natural gas - a key move given Turkey's plans to liberalize its gas market and considering more than half of Aksa Enerji's 2036 MW capacity is gas fired.

Turkey's oldest gas contract for 6bn cubic metres a year timed out at the end of 2011, with Turkey's energy ministry signaling early last year that state gas importer Botas would not extend the deal and private sector companies were free to negotiate their own deals for blocks of the pipeline capacity directly with Gazprom. Gazprom, however, apparently had different ideas, with Turkey forced to renew the Botas contract for a further year at short notice, with any private sector deals still up in the air.

Whatever the reason for the deal in finalizing the sale of Aksa Enerji shares to Goldman Sachs, neither side is currently giving anything away. But given recent revelations concerning the inner working of parts of the Goldman empire - and in particular the company's alleged "interesting" approach to customer relations, Kazanci Holding can be forgiven for hoping that Goldman's apparent cold feet are down to just changing market conditions.