Gaziantep plant resale

Gaziantep plant resale
Published: 21 March 2006

The earlier sale of the Turkish Gaziantep plant to the Turkish Sanko Holdings, which was subsequently revoked by the Turkish authorities is now back for sale with final tender results expected by late-April. Part of the sell-off of the defunct Rumeli group, Gaziantep provides an interesting purchase proposition, although its final transfer of ownership may still spring some surprises.

Gaziantep is favourably located close to Syria on Turkey’s south eastern border and produces around 543,230t of cement in 2005 mainly for local consumption but with some useful export outlets. It is in a region heavily populated by the Turkish/Kurdish community. The plant is close to the city of Gaziantep and as such, the complete plant site has a very attractive land value when its raw material base runs out in about 10 years.

The difficulty lies in the fact that the new owners will face Abdulkadir Konukoglu, chairman of Sanko Holding management board, who successfully bid for the plant with an offer of US$128m but was subsequently denied his prize, which would have dovetailed [too] well with his already extensive local construction interests and his ownership of the Adiyaman works some 100km to the northeast.

Turkish major Akcansa had apparently expressed interest in the first round of bidding for the plant but is not known whether to be willing to make a second attempt, with caution now being the watchword for most bidders.

One likely outcome is that Abdulkadir Konukoglu may well instruct nominees to bid again on his behalf, a plan that may well satisfy the turkish authorities who must recognise the difficulties any newcomer would face in this rather dynamic market region!