TAV Havalimanlari Holding AS, Turkey’s biggest airport operator, slumped the most in three years after withdrawing from a government auction to build and operate a facility in Istanbul.
The shares of TAV, in which Aeroports De Paris bought a 38 percent stake last year, tumbled 7.8 percent to 11.8 liras at the close in Istanbul. Almost eight million shares traded, more than six times the stock’s three-month average daily volume, according to data compiled by Bloomberg. The Borsa Istanbul National 100 index rose 0.6 percent, climbing for a ninth day to extend its record.
A group consisting of five closely held constructors, including Limak Insaat Sanayi ve Ticaret AS and Kolin Insaat Turizm Sanayi ve Ticaret AS offered to pay Turkey a rental fee of 22.13 billion euros ($29 billion) over an operational period of 25 years in a government auction held today in Ankara. TAV, which operates the Istanbul Ataturk Airport, withdrew before the final round of bidding.
“This auction had become a lose-lose situation,” Omer Lutfu Omerbas, an analyst at Ak Investment in Istanbul, said in a phone interview. “The winning bid is much higher than predicted. Even if TAV had won, such a price would have been questioned. But now, the company has lost the chance to extend its most profitable contract.”
The new airport is planned to be built near the Black Sea coast and about 60 kilometers (37 miles) northwest of the Istanbul city center. It will replace the Ataturk Airport, which generates 40 percent of TAV sales, according to the company’s website. The company’s operational concession ends in 2021.