How to privatize public enterprises in Turkey?: Alternative methods of valuation

Abstract

This study basically attempts to focus on privatizations andvaluation techniques which are integral part of all privatizationapplications. Subsequent to defining the concept, objectives, andproblems! the privatization practice in Turkey is discussed.Alternative methods of privatization accompanied by Turkish casesstudies where possible! are explained. In order to be able to makea comparision, a successful example, privatization in GreatBritain, is used. First chapter of the study ends with twoexamples from finalized privatization deals in Turkey, for whichthe financial performances are compared before and after the divestiture.In the second chapter! seven different methods of valuation arediscussed. Each is explained by the use of a case study.Subsequent to the discussion of the pro's and con's of severalmethods, it is proposed that the Discounted Cash Flow AnalysisMethod stating that a company is worth as much as the discountedsum of its future cash flows, is the best method for valuation.The last part of this study tries to come up with proposals whichare deemed necessary for the success of the privatization programand finishes with the over-all conclusion for the study.