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UPDATE 1-Akfen may bid for Istanbul gas grid-CEO

(Adds further details, quotes)

By Ayla Jean Yackley and Evrim Ergin ISTANBUL, Oct 9 (Reuters) - Turkish group Akfen Holding

may bid for Istanbul's natural gas distributionnetwork Igdas, which is slated for privatisation this year,along with a raft of other energy and transportation businessesthat could go up for sale, Chief Executive Suha Gucsav said onTuesday.

"We may bid for Igdas. Why not consider valuable assets?"Gucsav told Reuters in an interview.

The Istanbul-based company, which netted $434 million inMarch when it sold shares in airport operator TAV toAeroports de Paris has already declared its interest inthe government's Dec. 17 sale of Baskent, the capital Ankara'sgas distribution network with 1.35 million customers.

Akfen, one of the country's biggest construction firms withsales in the first half of the year up 11 percent at 640 millionlira ($354 million), could also double capacity at a gas-firedpower plant that it wants to build near Mersin in southernTurkey, Gucsav said.

The 570-megawatt plant is now expected to cost $500 millionwith work due to begin in the middle of 2013, but funding stillhas to be secured, he said.

"Regarding financing, foreign banks are not lending ... so Ithink it will be with Turkish banks. We will find the lending,but it will take time," Gucsav said.

One option is to sell equity in the plant to a supplier,such as a turbine producer, to fund the project, he said.

Besides the gas grids and the power station, Akfen mightalso be interested in bidding for Russian gas import contractsthe government plans to sell, Gucsav said, as well as the saleof container ports and road privatisations.

OTHER ASSETS

Meanwhile a public share offer for fast-ferry company IDO,in which Akfen owns a stake, will not be held before 2014 andmay be as late as 2016 because it first wants to expand thenumber of lines and introduce a roll-on roll-off (Ro-Ro) servicefor commercial trucks traveling between Istanbul's Asian andEuropen shores, Gucsav said.

A consortium of Tepe Holding, Akfen Holding, Souterinvestments and Sera OGG bought IDO for $861 million in 2011.

High valuations and tough funding conditions due to the eurozone crisis have forced the postponement of several Turkishprivatisations in recent years.

Turkish projects seeking financing right now are valued atbetween $25 billion and $30 billion, Gucsav estimated.

Without investment from abroad, many of these projects won'tget off the ground, but foreigners are reluctant to invest forthe time being, he said.

"Foreign financing is an absolute must and it will be easierto secure foreign investment once problems with Iraq, Iran andSyria are resolved. For now, these political risks are makingpeople wait and see," he said.($1=1.8107 Turkish liras)

(Editing by Helen Massy-Beresford and Greg Mahlich)

((ayla.yackley@thomsonreuters.com))

Keywords: AKFEN GAS/