The Privatisation Administration has invited seven banks to submit bids by 26 May to act as financial adviser on the sale of state telecommunications giant Turk Telekom.

The seven banks are: ABN Amro Rothschild, Goldman Sachs, JP Morgan, Lehman Brothers, Merrill Lynch, Morgan Stanley Dean Witter and Salomon Smith Barney.

The government plans to sell a 49 per cent stake in the company. A 20 per cent stake will be sold in a block sale to global buyers, 14 per cent to international and local investors through public offerings, 5 per cent to employees and 20 per cent to the postal services administration. A study co-ordinated by Goldman Sachs values the company at $12,000-14,000 million. The first tranche sale is expected to take place in the second half of this year.

The sale of two global standard for mobiles (GSM) licences was completed on 27 April. Turkcell - a joint venture between Telecom Finland, Sweden's Ericsson, Cukurova Holding, MV Komunikasyon and Bilka - and Telsim - owned by Rumeli Group and the US' Motorola - each paid the government $500 million for 25-year operating licences, replacing a revenue sharing agreement.

The two companies are now free to set their own charges, but they must transfer about 30 per cent of gross revenues to the treasury and Turk Telekom. Under the previous agreement, the two companies had to transfer two-thirds of their revenues to Turk Telekom. There are about 1.8 million mobile telephone subscribers currently in Turkey, about 80 per cent of which are clients of Turkcell. Turkcell aims to have 800,000 new subscribers by the end of the year.