Dogan Sirketler Grubu Holding AS, the owner of Turkey’s biggest media company, surged the most in almost four months on bets shareholders will benefit from a planned merger with unit Dogan Yayin Holding AS.
The shares rose 8.8 percent to 0.74 lira at 11:56 a.m. in Istanbul in the biggest advance since Dec. 25. About 34.7 million shares changed hands, or 4.5 times the three-month daily average, according to data compiled by Bloomberg. Dogan Yayin climbed 12 percent, the most since November 2012, to 0.57 lira. The Borsa Istanbul 100 index added 0.6 percent.
Dogan will take over Dogan Yayin, the companies said in separate public filings after the market closed yesterday. Investors who object to the proposed deal will have the right to sell stock at 0.67 lira for each Dogan Holding share and 0.5 lira each for Dogan Yayin, according to the statements.
“Both companies were trading at significant discounts over their net asset values,” Haydar Acun, who manages the Sardis Turkish Equity Fund, said by phone from Istanbul. “The holding company will be acquiring the media company’s assets for cheap. There would also be significant cost savings after.”
Dogan Yayin was given tax levies totaling $3.8 billion in 2009 after its newspapers got embroiled in a row with the government over coverage of a corruption scandal that involved an Islamic charity in Germany. The government said the levy resulted from a routine inspection.
Since September 2009, when the media company received the biggest portion of the fines, Dogan Yayin and Dogan Holding shares fell 58 percent and 47 percent, respectively. That compares with a 58 percent gain in the benchmark index.
The merger plan announced yesterday lifted other Dogan companies listed in Istanbul. Hurriyet Gazetecilik ve Matbaacilik AS rose 11 percent in the biggest surge since January 2011. Dogan Gazetecilik AS increased 8.1 percent, its first gain in four days.
Dogan Holding, Hurriyet and Dogan Gazetecilik are among the Sardis fund’s top 10 holdings, according to March data published on its website.