London court says Turkish trustees have no claim on alleged Gulen-linked firm's UK asset

Reuters News
Posted: Dec 22, 2016 2:34 PM

By Barbara Lewis and Dasha Afanasieva

LONDON (Reuters) - London's high court ruled Turkey had no rights over British assets that are part of the Koza Ipek media and mining conglomerate, in a victory for exiled Turkish businessman Akin Ipek, whose businesses have been seized by the state.

Turkish authorities have taken control of hundreds of companies, including Istanbul-listed gold mining company Koza Altin which was placed in receivership in October 2015, for alleged links to Islamic cleric Fethullah Gulen.

U.S.-based Gulen was once an ally of Turkish President Tayyip Erdogan and his AK Party but relations soured from 2013. Ankara accused Gulen's network of followers of orchestrating an attempted coup in July and branded it a terrorist organization.

Gulen has denied accusations he played a role in the attempted coup and said he condemned it in the strongest terms.

Following the court judgment handed down on Wednesday, London-based Ipek, said in an email to Reuters he was "very happy to see justice".

"There have been many crazy slanders and accusations about me and my companies. The latest court decision in the UK is one fruit of an honestly lived life," he said.

Koza Altin's trustees said they are seeking the removal of Ipek, as a director of Koza Ltd, a British subsidiary set up in March 2014, and to prevent him from deciding what to do with some 60 million pounds ($73.77 million) of shareholders' capital held by Koza Ltd.

Court documents seen by Reuters showed a judge in the Chancery Division of the High Court of Justice found Turkish trustees had no authority over British-based assets. Turkish officials were not immediately available to comment.

The judge also ruled that the approximately 60 million pounds could be transferred to accounts managed by Hanson Asset Management, which could allow the British subsidiary to get a higher return on its capital.

Hanson Asset Management was not available for comment.

A spokesman for Koza Altin said it was confident of its case and expected further legal action. No-one from Mischon de Reya, the lawyers that represented the Turkish trustees, was available for comment.

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The rift between Gulen and Erdogan escalated when Gulen's network was blamed for a corruption probe in late 2013 which implicated members of Erdogan's family and government.

In the most high-profile clamp down on a Gulen-related company, lender Bank Asya, which was founded by the cleric's followers, was seized, and its operating rights eventually canceled when no buyer could be found for the tainted asset.

Ipek's family business Ipek Holding has a 25 percent stake in Koza Altin.

The share price of Koza Altin, which counts the Vanguard Group and Schroeder Investment management among its shareholders according to Reuters data, has been volatile as political events have unfolded.

(Editing by Alexandra Hudson)