South Korean Conglomerate Puts Istanbul Tunnel Stake Up for Sale

(Bloomberg) -- A unit of South Korean conglomerate SK Group is planning to sell its minority stake in a consortium that operates a $1.3 billion sub-sea road tunnel across the Bosphorus in Istanbul.

SK Gas Ltd. has hired an adviser to manage the divestment of its 18% stake in the joint venture, formally known as Avrasya Tuneli Isletme Insaat ve Yatirim AS, or Atas, according to people with knowledge of the matter.

A spokesperson for SK Gas confirmed it’s considering a sale.

The project incorporates a 14.6-kilometer (9.1-mile) road with a 5.4-kilometer stretch of tunnel under the Bosporus strait’s sea bed. It will ease car traffic on two suspension bridges that join the city’s European and Asian sides, serving more than 15 million people in Turkey’s biggest city. About 120,000 vehicles will travel through the road daily.

There’s no certainty that the sale attempt will result in a transaction, said the people, who asked not to be named because the deliberations are confidential. Atas declined to comment.

Yapi Merkezi AS, headquartered in Istanbul, owns 50% in the venture. The remainder is held by another unit of Seoul-based SK Group, the builder SK E&C, according to Atas’s website.

The consortium, which borrowed an 18-year loan of $960 million in 2012 to build the project, will run the toll tunnel for over 24 years years from August 2017, when it started operations.

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