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(Bloomberg) — Turkey’s Kontrolmatik Enerji ve Muhendislik defaulted on two separate lira bonds that matured on Friday, according to a statement by Turkey’s Central Securities Depository, marking a rare corporate debt default in the country’s local bond market.
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The Turkish technology and engineering company failed to make the scheduled payment on two TLRef-indexed floating rate bonds due May 15, the depository said. The instruments included a 250-million-lira ($5.5 million) two-year bond and a 200-million-lira one-year bond.
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In an exchange filing later Friday, the company said it and its subsidiary Pomega Enerji Depolama Teknolojileri had applied to state lenders Turkiye Halk Bankasi AS and Turkiye Vakiflar Bankasi to restructure existing bank loans.
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Kontrolmatik said coupon and principal payments on the bonds could not be fulfilled “due to the current financial conditions,” adding that the obligations are planned to be paid after the restructuring process is completed.
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Corporate bond defaults remain relatively uncommon in Turkey, where companies have traditionally relied more heavily on bank loans than capital markets for funding.
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The Istanbul-based company that listed in 2020 has a market capitalization of about 11 billion liras. The firm emerged as one of the standout performers on the Borsa Istanbul in the years following the pandemic, buoyed by strong retail investor demand for shares linked to energy industry and technology.
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Its shares have come under pressure in recent years amid tighter financial conditions. The stock has fallen 84% from its peak in September 2023 and closed 10% lower at 8.46 liras in Istanbul.
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Last month, Chairman Sami Aslanhan and deputy chairman Omer Unsalan sold shares, cutting their stakes to less than 5% each, according to exchange filings.
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—With assistance from Tugce Ozsoy.
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(Updates with Kontrolmatik statement in third and fourth paragraphs.)
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