Regions

Bank of America Merrill Lynch pulls out of bidding to advise Turkish Aselsan after China deal

December 6
8:21 AM 2013

Bank of America Merill Lynch has withdrawn from bidding to advise Turkish defense contractor Aselsan. BofA Merill Lynch's decision to drop out of the process came after the government of Turkey struck a preliminary defense deal with a Chinese firm under US sanctions. 

According to Reuters, government of Turkey in September said it had chosen an air and missile defense system built by China Precision Machinery Import and Export Corp. (CPMIEC) over rival offers from Franco-Italian Eurosam SAMP/T and US firm Raytheon Co. BofA Merill Lynch had made a joint bid with Turkey's Halk Investment to advise Aselsan on a planned secondary listing, but has since written to the firm to say it was pulling out, the report said. 

Reuters said that US and NATO officials are unhappy with Turkey's choice of CPMIEC. The Chinese firm is under US sanctions for selling items to Iran, Syria or North Korea that are banned under US laws. On the other hand, the government of Turkey has said the USD3.4 billion Chinese deal offered the most competitive terms. It would also help achieve its aim of building a stronger domestic defense industry by allowing co-production, the report said. 

Turkish officials, however, made clear that the decision is not yet final, Reuters said.  

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