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UPDATE 2-Turkish discount retailer Sok plans 2018 IPO - sources
August 21, 2017 / 12:29 PM / a month ago

UPDATE 2-Turkish discount retailer Sok plans 2018 IPO - sources

* Latest sign Turkish IPO market coming back to life

* Analysts see Sok’s sales reaching 8 bln lira this year

* Shares in 39 pct-owner Gozde Girisim jump 7 pct (Adds share reaction, details about economic growth, IPO market)

By Ebru Tuncay and Ceyda Caglayan

ISTANBUL, Aug 21 (Reuters) - Turkish discount retailer Sok is planning an initial public offering in 2018, two sources familiar with the matter told Reuters, the latest sign that Turkey’s IPO market may be coming back to life.

Sok, with more than 4,700 stores and 21,000 employees, is one of Turkey’s biggest discount retailers, selling groceries, fresh produce and household items.

It is 39 percent owned by Gozde Girisim, the investment arm of food giant Yildiz Holding, and half owned by a Netherlands-based investor consortium. A private equity fund run by Templeton Asset Management also holds 10 percent.

“If the markets are in a good condition, the Sok public offering is planned for 2018, and the work has begun,” said one of the sources, declining to be identified because the information is not yet public.

Other substantial IPOs are also expected in the future, the source said.

Yildiz declined to comment on the timing of the listing. “While a public offering is one of Sok’s future targets, a specific date has not yet been set,” it said.

It also declined to comment on Sok’s financial performance, although analysts estimate it achieved sales of 6 billion lira ($1.7 billion) in 2016 and could reach 8 billion lira this year.

It was not immediately clear how much of the company would be up for sale - or how large the listing would be. Gozde and its partners acquired Sok for $342 million in 2011 from rival retailer Migros.

Gozde’s shares rose as much as 7.4 percent on the news. They were up 2.2 percent at 3.73 lira in late afternoon trade in Istanbul.

SLOW RECOVERY

Turkey’s IPO market has been on a slow recovery since 2015, when it recorded its worst year in more than a decade, with just $45 million in listings, according to Thomson Reuters data.

Investors have been worried about rising security concerns and a sell-off in the lira currency. Last year’s failed coup attempt and the crackdown that followed has also dampened enthusiasm for what was once a star emerging market.

However, there are now signs of more activity. So far this year, Turkish IPOs have totalled $504 million, on track for their best annual showing since 2013.

Much of that was from jeans retailer Mavi Giyim which raised $334 million in June.

Turkey is home to nearly 80 million people and has one of the youngest populations in Europe. Economic growth is seen at 4.4 percent this year, although government ministers have said it may be higher.

Turkven, one of Turkey’s leading venture capital firms, said last week it was planning an IPO or block sale of its majority stake in the Medical Park hospital group.

$1 = 3.5038 liras Writing by Daren Butler; Editing by David Dolan and Mark Potter

Our Standards:The Thomson Reuters Trust Principles.
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