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

Abstract

ABSTRACT This study basically attempts to focus on privatizations and valuation techniques which are integral part of all privatization applications. Subsequent to defining the concept, objectives, and problems, the privatization practice in Turkey is discussed. Alternative methods of privatization accompanied by Turkish cases studies where possible, are explained. In order to be able to make a comparision, a successful example, privatization in Great Britain, is used. First chapter of the study ends with two examples from finalized privatization deals in Turkey, for which the financial performances are compared before and after the divestiture. In the second chapter, seven different methods of valuation are discussed. Each is explained by the use of a case study. Subsequent to the discussion of the pro's and con's of several methods, it is proposed that the Discounted Cash Flow Analysis Method stating that a company is worth as much as the discounted sum of its future cash flows, is the best method for valuation. The last part of this study tries to come up with proposals which- are deemed necessary for the success of the privatization program and finishes with the over-all conclusion for the study. - I -