By Asli Kandemir
ISTANBUL (Reuters) - The head of one of Turkey's biggest retailers, once consigned by Tayyip Erdogan to the ranks of "riff-raff", might be forgiven for having sensed the hand of the president recently when Istanbul Stock exchange raised alarm with a terse warning to his company.
Cem Boyner's department store company joined a list of companies that have faced legal or regulatory pressure after falling out with Erdogan or the ruling AK Party he founded. Investors are increasingly worried that in Turkey, dissent is bad for business.
"At risk are companies that are perceived to be close to opposition forces, or firms whose bosses' public remarks may have antagonized the government," said Wolfango Piccoli, managing director of Teneo Intelligence.
Erdogan has raised concern at home and in the European Union Turkey seeks to join, with his open conflict with media firms and business heads. The president, still the most popular leader in decades, says he is fighting domestic and foreign attempts to slur him with graft accusations and undermine the country.
This year, the government has seized the assets of Islamic lender Bank Asya, which was founded by followers of U.S.-based Muslim cleric Fethullah Gulen, an ally-turned-foe Erdogan accuses of trying to engineer a coup against him.
In October authorities took over 22 firms owned by unlisted Koza Ipek Holding, including its opposition media outlets. Like Bank Asya, Koza Ipek has links to Gulen.
"It's a distinct possibility that there are further episodes of these 'revenge politics' ahead," Piccoli said.
The pro-government Sabah daily described a regulatory order against Boyner as "a warning to the riff-raff Boyner from the stock exchange". The term echoed Erdogan's characterization of thousands, Boyner included, who protested in 2013 against what they saw as his increasingly authoritarian rule.
The Boyner Holding Chairman, who once himself nurtured political ambitions, carried a banner taunting Erdogan with the words "I am neither a rightist nor a leftist, I am riff-raff".
The stock exchange warned Boyner on Nov. 17 to shore up its balance sheet, citing a recent 82 percent slide in its capital. It didn't specify an amount for the increase.
Yet Boyner had already applied to delist, raising questions as to why the exchange was even bothering to single it out.
"They might not even be traded by the time they would raise any additional capital," said one analyst, who declined to be identified. Only about 3 percent of Boyner's shares are traded on the stock exchange and it is due to be delisted by the end of the year.
The drop in capital was largely due to accounting procedures related to acquisition of another retailer, the analyst said.
Still, investors were concerned.
"I could not count how many worried investors called to ask what was behind the order to Boyner," said a top executive of a brokerage. "This is a highly politicized and certainly not an investor-friendly climate."
Government officials declined to comment, as did Boyner, whose companies include the Boyner department stores chain and Beymen clothes shops.
An Istanbul Stock Exchange official told Reuters the exchange made such warnings to all companies, in line with listing regulations.
In one of the best known clashes between Erdogan and a media body, Dogan Media Group was fined $2.5 billion for unpaid taxes in 2009. Many critics saw the move as an attempt to crush criticism following its coverage of corruption allegations against people close to him; something Erdogan denied.
Prosecutors began investigating Dogan in September for alleged "terrorism propaganda". Opposition newspaper Cumhuriyet, whose top two journalists were arrested last week on charges of espionage and terrorist propaganda, also faces an investigation into its tax accounts, its chief executive says
Contrasting fortunes of companies mirror a broader shift in Turkish commerce in the years since AKP came to power in 2002.
Older conglomerates that dominated commerce in pre-Erdogan times have found themselves sidelined. Ankara canceled a $5.7 billion bridges and runway privatization won by a consortium including Koc Holding in 2013. The government also canceled a warship production tender awarded to a Koc company.
If those who cross Erdogan can expect little sympathy, then a new generation of enterprises has found favor.
Building and energy firms close to Erdogan have prospered, such as Calik Holding, run until the end of 2013 by Erdogan's son-in-law Berat Albayrak, now Turkey's energy minister.
Turkuvaz Group, owned by Calik Holding, now runs the pro-government Sabah newspaper, while the Demiroren group owns Vatan and Milliyet dailies. Ethem Sancak, who runs the pro-government Aksam daily, recently won many tenders from the government, including for his truck and bus producer BMC.
Dogan Holding CEO Yahya Uzdiyen sees hard times ahead.
"Our energy has significantly been drained because of the social and psychological pressure in our media business as well as global economic problems," he said recently.
(Additional reporting by Ceyda Caglayan and Birsen Altayli in Istanbul and Orhan Coskun in Ankara; Editing by David Dolan and Ralph Boulton)