Turkcell secures EUR100 million Islamic finance deal

Published 20/05/2025, 11:22
Turkcell secures EUR100 million Islamic finance deal

DUBAI - Turkcell (NYSE: TKC) (BIST: TCELL), a prominent technology and telecommunications company with a market capitalization of $5.5 billion and "GREAT" financial health according to InvestingPro metrics, has announced a significant EUR100 million murabaha financing agreement with Emirates NBD Bank, a key banking group in the MENAT region. The company, currently rated as undervalued by InvestingPro’s Fair Value model, has demonstrated solid financial performance with $4.5 billion in revenue over the last twelve months. This strategic deal is intended to bolster Turkcell’s data center investments through its subsidiary TDC Veri Hizmetleri (TDC), aiming to accelerate its digital infrastructure initiatives and support its long-term strategic growth objectives.

The five-year financing, based on Islamic murabaha principles, which prohibits interest, is a testament to the confidence that global financial institutions have in Turkcell’s strategic direction. The company’s focus is on developing high-capacity, eco-friendly data centers to cater to the increasing needs for cloud computing, AI, and big data services. This move is in line with national digitalization goals, as Turkcell aims to support local businesses and attract international clients seeking secure and scalable digital solutions.

Kamil Kalyon, Chief Financial Officer at Turkcell, expressed pride in attracting international investment into their data center operations. He believes that this financing will lead to more strategic partnerships and investments, thus fostering growth and collaboration in the digital landscape.

The transaction also highlights Turkcell’s efforts to diversify its financing sources and strengthen relations within the Gulf region. The murabaha financing structure is expected to pave the way for further strategic partnerships in key markets.

Pri McNair, Group Co-Head of Corporate Coverage at Emirates NBD, emphasized the bank’s commitment to supporting growth-oriented companies like Turkcell that are investing in digital transformation. McNair stated that the deal with Turkcell consolidates its position as a telecom leader and reflects Emirates NBD’s role as a trusted financial partner.

Turkcell, headquartered in Türkiye, offers a range of services including voice, data, IPTV, digital consumer, enterprise, and techfin services. It operates in Türkiye, Belarus, and Northern Cyprus and is the only company dual-listed on both the NYSE and BIST.

Emirates NBD, with total assets of approximately USD 272 billion as of March 31, 2025, serves over 9 million active customers across 13 countries. The banking group is a major player in digital banking, with 97% of financial transactions conducted outside of branches. Turkcell’s strong market position is further validated by analysts’ positive outlook, with a consensus Strong Buy recommendation and an attractive dividend yield of 3.76%. InvestingPro subscribers can access detailed analysis, including comprehensive valuation models and growth projections.

This news is based on a press release statement from Turkcell.

In other recent news, Turkcell reported a strong financial performance for the full year 2024, with revenue reaching TRY 166.7 billion, marking a 7.8% increase year-over-year. The company’s net income surged by 30% to TRY 23.5 billion, showcasing its strategic advancements in 5G technology and digital services. Turkcell also added 1.9 million net postpaid subscribers and expanded its fiber network with 168,000 net additions. The Paycell mobile payment platform experienced a 33% growth in the fourth quarter, further contributing to the company’s robust results. Turkcell’s strategic focus on enhancing telecommunications infrastructure and digital services has reinforced its market leadership. The company anticipates revenue growth of 7-9% for 2025, with a significant emphasis on data center and cloud revenue, projected to grow by 32-34%. Turkcell is preparing for a 5G tender in 2025 and has issued a USD 1 billion bond to refinance a maturing bond and support future growth initiatives. Despite inflationary pressures and competitive market dynamics, Turkcell remains optimistic about its future growth prospects.

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