UPDATE 3-Turk Telekom raises $1.9 bln in top-of-range IPO

(Recasts, adds size, Turkcell stock)

By Hatice Aydogdu

ANKARA, May 12 (Reuters) - An initial public offering for Turkish fixed-line operator Turk Telekom TTKOM.IS was priced near the top of an initial range, raising $1.9 billion as Turkey liberalises its economy and seeks much-needed foreign cash.

Privatisation Administration (OIB) Chairman Metin Kilci told reporters on Monday the offering at 4.6 lira a share, valuing the company at 16.1 billion lira ($12.8 billion), would be Istanbul's largest IPO, just ahead of Halkbank's HALKB.IS listing last May which raised about $1.85 billion.

The Turk Telekom sale was priced at a hefty discount to other stocks and an over-allotment option was not used. It follows a 24 percent fall on the main Istanbul index this year, which has prompted some companies to postpone IPOs.

Ankara had budgeted on the deal raising 3.9 billion lira ($3.1 billion).

Demand from Turkey-based investors was 4.7 times the amount on offer and international investors sought 4.3 times the stock being sold. The tranche allocated to locals was raised from an initially planned 35 percent to 40 percent, Kilci said. The rest was for international investors.

"Compared to previous ones, it could have been better, but under current market conditions it was a success for the Privatisation Administration," said Yurdal Yalman, head of research at Oyak Securities.

"I believe the fact there's decent demand would have a positive impact on the market," he said.  Continued...