Turkish business dynasties accused of backing 'post-modern coup'

Reuters

By Humeyra Pamuk and Nick Tattersall

ISTANBUL (Reuters) - A lawyer accused two of Turkey's corporate dynasties on Friday of backing the 1997 military overthrow of its first Islamist-led government, sending their shares tumbling on fears of a deepening vendetta against the country's secular business elite.

Shares in family-run conglomerates Dogan Holding and Koc Holding fell nearly 8 percent and more than 3 percent respectively after lawyer Mustafa Polat filed a complaint against them in a trial of alleged plotters.

Neither Dogan nor Koc had any immediate comment.

The events of 1997 were dubbed the "post-modern coup" as the generals used pressure behind the scenes to force Prime Minister Necmettin Erbakan from power, in contrast to the direct intervention of three military coups in 1960, 1971 and 1980.

The trial of more than 100 senior army officers over their alleged role in the overthrow goes to the heart of the tensions between Prime Minister Tayyip Erdogan's Islamist-rooted government and a secular elite, which includes some of its leading business figures as well as the army.

Erdogan, who was a member of Erbakan's Islamist party, has made curbing the military's political clout one of his main missions during his 10 years in power.

Polat said he had filed the complaint against Aydin Dogan and the holding company of the Koc family, which owns five of Turkey's 10 largest companies and whose interests account for an estimated 10 percent of national output, because there was clear evidence of their opposition to Erbakan's government.

"These are people and companies whose names appear regularly in the indictment of the case," Polat told Reuters, adding he believed they had been in contact with a clandestine group within the military linked to the overthrow.

"The Ankara chief public prosecutor's office will now carry out the necessary legal investigation," he said.

"GOLDEN GOOSE"

Erbakan, who died of heart failure aged 85 in 2011, pioneered Islamist politics in Turkey, a largely Muslim country with a secular state order, and paved the way for the subsequent success of Erdogan's AK Party.

The complaint against Koc and Dogan comes a day after Erdogan said he was "surprised" that corporate interests which he said had been supportive of past coup attempts in Turkey had not been held to account.

"Critics of the Erdogan administration will argue that this is all part of the payback against Turkey's secular establishment," said Timothy Ash, head of emerging markets research at Standard Bank.

But the move came as a surprise.

"Remember the Koc group is a huge industrial concern in Turkey, accounting for something like 10 percent of GDP. The assumption was that the AKP administration would not risk killing the golden goose," Ash said.

Erdogan has overseen a near tripling of nominal wealth in Turkey over the past decade but critics say he favors a new business elite, often sharing his religiously conservative values, over a secular class that had long held sway.

Koc and Dogan have been in the firing line before.

The government launched a probe into the taxes of Koc energy firms in July, weeks after criticizing one of the family's hotels for sheltering protesters during anti-government unrest that rocked several cities over the summer.

The finance minister said there was no link to the protests.

Erdogan's government has in the past levied heavy tax fines and seized the assets of media firms perceived to be critical of his administration. The government has denied any political motivation in such cases.

Dogan Holding, once Turkey's largest media group, was fined over $2.5 billion for alleged tax evasion in 2009. But the case slipped under the radar after Dogan, which also has energy, manufacturing and finance interests, sold two dailies and a television channel as part of what it called a routine restructuring.

(Additional reporting by Ece Toksabay; Writing by Nick Tattersall; Editing by Sonya Hepinstall)

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