ISTANBUL: Turkish food producer Yildiz Holding on Monday said its conscience was “clear” and its businesses “clean”, after reports suggesting it was the latest target of a government crackdown sent shares of three of its group companies tumbling.
Yildiz, which calls itself the largest food manufacturer in central and eastern Europe, the Middle East and Africa, owns a portfolio of international brands including Godiva chocolate and McVitie’s biscuits.
It also has ties to other international firms, including a joint venture with Japan’s Nissin Food selling instant noodles.
Shares in three of its companies - biscuit maker Ulker , investment fund Gozde Girisim and food wholesaler Bizim all fell more than 10 percent at one point on Monday, and the lira currency weakened.
“To the attention of our valuable investors: There are those who are making a fuss for no reason. Our conscience is clear, our work is clean. We continue to work,” Yildiz Chairman Murat Ulker said on Twitter.
Following an article in the pro-government Sabah newspaper, analysts cited concern that Yildiz was next in line in the purge, in which more than 110,000 people have been sacked or suspended and more than 36,000 arrested.
The article did not name Yildiz, but alleged a link between an unnamed company and a group previously seized by authorities over suspected ties to Fethullah Gulen, the cleric Ankara blames for a failed July 15 coup.
Market participants said the unnamed company was widely believed to be Yildiz. “(The) article which appeared in Sabah daily might have caused the sharp sell-off,” brokerage TEB Investment said in a note to clients.
SHARP SELL-OFF
In an earlier statement, Yildiz said a news report had targeted the group’s companies, adding it had “nothing to do” with such an investigation and calling a second report on news website odatv.com “unacceptable”.
Investors continued to sell after the denial from Yildiz and its chairman, although all three companies pared some of their losses. One foreign exchange analyst said concern about the report was partly responsible for lira weakness on Monday.
The currency fell nearly 1 percent against the dollar. It has fallen 11 percent against the dollar this year, making it the fifth-worst performer among a basket of 25 emerging market currencies.
Investors have been worried about the scope of the crackdown, which started in the civil service and then spread to the private sector.
Turkey blames Gulen for orchestrating the attempted coup, when rogue soldiers commandeered tanks, fighter jets and helicopters to attack the parliament and attempted to overthrow the government.
Gulen, who has lived in self-imposed exile in the U.S. state of Pennsylvania since 1999, has denied involvement and condemned the coup.
Critics say President Tayyip Erdogan is using the crisis to curtail dissent and tighten his grip on power. The government says the moves are necessary to root out Gulen’s followers.
The Yildiz companies were the three biggest percentage decliners on the BIST 100 index. Bizim fell 9 percent, Ulker dropped 8.4 percent and Gozde Girisim lost 6.3 percent. The index lost 0.8 percent by 1446 GMT, with Bizim the biggest drag.
(Additional Reporting by Akin Aytekin, Behiye Selin Taner and Ece Toksabay; writing by David Dolan; editing by Andrew Roche)
