Petrol Ofisi revealed yesterday that Turkish tax authorities had demanded 360 million lira (US$ 257m) in tax and 625 million lira (US$ 445m) in fines for the years 2002 to 2006. The firm said in a statement to the stock market it would use all its legal rights against the decision.
Our view: The tax is 43% of Petrol Ofisi’s current market cap of US$ 1.63bn. Since market already calculated a big part of this (Tax Authority already announced TRY 435m tax claim for 2004-05 last month), drop in the share price was limited yesterday. Moreover, Dogan Holding’s statement to buy up to 5% of Petrol Ofisi shares in the next six months also limited the negative reaction on the market. As the talks between PO and the tax authority will start soon, the share price will react on the likely press speculations on the outcome, in our view. OMV share price dropped 0.7% yesterday, mostly driven by this news. We do not project further reaction of OMV on this issue in the short-term.