The government has raised about $330 million from the sale of most of its 21 per cent stake in leading local car maker Tofas, a licensee of Italy's Fiat. It had expected a return of $418 million. However, the $330 million is encouraging in view of adverse market conditions, officials of the Public Participation Administration (KOI) say.

Despite KOI's claims, critics say the deal was mistimed because the rise in US interest rates had hit stock markets internationally, and because the Istanbul bourse was depressed by the foreign exchange crisis. A slump in sales and higher import costs have also undermined the car industry since the outbreak of the crisis in mid-January (MEED 4:3:94, see page 5).

The domestic issue price was TL 72,000 ($3.30) a share, compared with the TL 125,000 ($6.85) a share when the stock market was at a record peak, just before the crisis broke. Trading in the shares since the sale has also been flat, both at home and abroad.

The deal started on 3 March with the placement with international investors of 20 million shares packaged as American depositary receipts and global depositary receipts priced at $16.50 each, which had been oversubscribed by around two-and-a-half times. A further offering of 1 million shares followed the next day on the Istanbul stock exchange. But the authorities have not disclosed how much more of the government's initial stake of about 25 million shares was released subsequently as part of the domestic sale from 4-7 March. Any left over cannot be reissued for six months, according to capital market rules. The sale was arranged by the UK's Schroders in association with the local Interbank, and Lehman Brothers of the US with the local Finansbank.