Producing artillery shells for Ukraine: Who bought the giant factory plot in capital Ankara?

How did the price of a plot worth 149.5 million liras drop to 54.9 million liras one day before its sale?

There is an interesting story behind this question. It starts from a real estate sale in the capital Ankara to a multi-million dollar military deal.

How?

First of all, the issue also concerns Finance Minister Mehmet Şimşek. Şimşek announced that they are closely following the advertisements related to real estate sales and that they will catch those who show a price below the real value in the deeds. Here is a case regarding this.

On April 25, 2024, a real estate broker in Ankara went to a tax office and filed a complaint. On the same day, he filed a criminal complaint with the prosecutor's office. The reason for the complaint was that a plot in Sincan, which had been advertised at 149.5 million liras for six months, was suddenly reduced to 54.9 million liras and changed hands a day later. They alleged that the state had been harmed, and presented evidence. According to calculations, the loss in taxes and fees was around 75 million liras.

Up to this point, as we are accustomed to in real estate sales, the issue is mostly the issue of undervaluation in the title deed at the request of the seller. What comes next is more interesting. Because, on the buyer's side, the name of a company that no one knew until now and which will soon become one of Turkey's largest arms exporters is written: Arca Defense. It bought the plot to build a new facility for the production of artillery shells to be sent to Ukraine.

How do we remember Arca?

On April 16, I covered the ammunition deal signed between the US and Turkey. (You can read the details via this link in Turkish.)

The most used ammunition in the Russia-Ukraine war is the 155 mm artillery shell and NATO cannot keep up with the demand. A new billion-euro package has been prepared for the EU to produce it. Turkey could not be included in the tender due to the veto of France, the Republic of Cyprus, and Greece. The US found a solution and subcontracted a significant part of its share to Turkey. Bloomberg announced the move the day before the March 31st local elections. The company mentioned in the reporting was Arca Defense.

A merchant from Çorum founded the firm in Ankara in 2020. Its growth rate is incredible. The company's introduction reads as follows: "It produces mortars from 900 mm to 120 mm, 122 mm short and long-range multi-barreled rocket launchers, 122-152-155 mm artillery ammunition."

Its factory is located in Çorum, in the organized industrial zone, which was started to be built for six billion liras by the Mechanical and Chemical Industry Corporation (MKE) and opened by President Recep Tayyip Erdoğan in August 2023. Next to Arca, another new company is counting the days. Gold Force Barut, owned by Ahlatçı Holding, which established a gold refinery in 2011 and announced that it would bring and process Venezuelan gold. When it starts production, Arca will buy all of its raw materials from there.

We learned this information about Arca from a local newspaper in Çorum, which has been awarded the artillery shell business from the USA and is said to produce a significant portion of the ammunition for domestic and national howitzers, mortars, and rocket launchers. Its chair İsmail Terlemez spoke only there.

Where did we hear his name? Let's go back to the archive.

MP Özgür Ceylan, a CHP member of the Turkish Grand National Assembly's Defense Commission, announced a bizarre deal made by the MKE in June 2021. According to the claim, MKE had reached an agreement with a newly established company called NEPSA for the production of bullets for 25 years, with a purchase guarantee of 120 million units. NEPSA would also be able to use one of MKE's factories. One of the signatories of the agreement was İsmail Terlemez on behalf of NEPSA Defense Industry. Later, İYİ Party MP Lütfü Türkkan also brought the issue to the agenda of the Parliament.

It was not disclosed whether there was such an agreement, but we never heard NEPSA Defense again. In November 2023, Terlemez transferred his shares in Arca, which he had founded at the same time as NEPSA, to Savaş Balçık, a former AKP Şişli district head who had been selling consumer durables in Istanbul for many years and then branched out into construction, especially military construction tenders. Terlemez is still one of the company's directors.

It seems that the demand for ammunition in the war in Ukraine has given rise to a new arms company in Turkey. Young entrepreneurs have achieved this success in just two years, as if touched by a magic wand.

Meanwhile, the Serbian public heard the name of Arca Defense before us. Moreover, the US had not yet shifted the production of artillery shells to Turkey. Let's leave for later these very important arms trade allegations, which are also associated with a Serbian arms dealer with a dark record.

It is necessary to question whether some people are being favored over the state's military companies, which are covered with an ideological veil by calling them domestic and national, and which command billions of liras of resources, technological know-how, and patents. Because this is the real “survival problem.” We should not forget the fate of the tenders for tank tracks and national tanks.