Cukurova Holding AS lost its bid to overturn a court order to pay about $1 billion to TeliaSonera AB in a dispute over shares in Turkcell Holding AS, the owner of Turkey’s biggest mobile-phone provider.
The U.K. Privy Council upheld an arbitration ruling today awarding damages to a unit of TeliaSonera, a Swedish phone operator, which claimed Cukurova failed to honor a 2005 agreement to sell its 53 percent stake in Turkcell.
The court rejected Cukurova’s argument that it hadn’t been able to properly present its case and that a court in the British Virgin Islands that first upheld the arbitration ruling wasn’t entitled to enforce the damages. Turkcell Iletisim Hizmetleri AS fell as much as 3.2 percent in Istanbul trading today.
Turkcell has been at the center of long-running legal disputes among its founder, Mehmet Emin Karamehmet, who owns Cukurova, TeliaSonera and Mikhail Fridman, the Russian billionaire who controls Alfa Group. In a separate case, the U.K. Privy Council ordered in July 2013 that Cukurova should pay $1.56 billion to recover a 13.7 percent Turkcell stake seized by Alfa in 2005.
“Our top priority is to get ordinary corporate governance in place in Turkcell,” Salomon Bekele, a TeliaSonera spokesman, said in an e-mail. “Among other things this means representation on the board for the shareholders, the holding of an AGM, and a decision on distribution of dividends.”
Cukurova’s lawyer, John Reynolds, didn’t immediately respond to e-mails seeking comment.
The arbitration has also been the subject of a legal challenge in the U.S. In April, a New York appeals court said TeliaSonera couldn’t enforce the damages award in the U.S. because Cukurova didn’t have sufficient ties to the country.