The first direct high-yield offering to come out of Turkey
has closed, avoiding the administrative burdens of the
customary loan participation note (LPN) structure.
In November construction company Yuksel Insaat issued $200
million of high-yield notes directly instead of through an
offshore bank which would loan back the proceeds.
Turkish issuers typically choose the LPN structure because
it sidesteps the need to pay 10% withholding tax on interest
payments. But changes to the capital markets regime, combined
with the increased cost and complexities associated with
intermediate issuers, meant a direct placement was preferred in
"It offers more certainty over tax...