Koc Holding Plunges After Share Sale Canceled: Istanbul Mover

Koc Holding AS (KCHOL), Turkey’s biggest group of companies, retreated the most in more than 15 months after three family members canceled a planned sale of 100 million shares.

Koc shares fell as much as 5.5 percent, the biggest decline since November 2011, to 9.45 liras and traded 3 percent lower at 9.65 liras as of 11:09 a.m. in Istanbul. About 7.9 million shares changed hands, more than twice the three-month daily average volume, according to data compiled by Bloomberg. The Istanbul Stock Exchange National 100 (XU100) index dropped 0.1 percent to 83,261.03 points. Koc accounts for 3.5 percent of the gauge.

Price offers received during the accelerated bookbuilding managed by Deutsche Bank AG’s London unit failed to “rise to a satisfactory level,” triggering the cancellation of the private placement announced yesterday, according to a joint statement by Honorary Chairman Mustafa Rahmi Koc, Chairman Mustafa Vehbi Koc and Suna Kirac to the Istanbul bourse today.

The three shareholders originally planned to sell a combined 3.94 percent stake, according to a filing with the Istanbul Stock Exchange after the market closed. The holding was worth about 1 billion liras ($554 million) at yesterday’s closing price of 10 liras a share. The securities were being offered to overseas institutional investors at between 9.50 liras and the market price, according to terms obtained by Bloomberg News.

“At first we viewed this as slightly negative for the stock -- one would expect a discount at a private placement,” Burak Isyar, an analyst at Burgan Securities in Istanbul, said in a phone interview today. “But now there are two negatives. First, we know that these shareholders want to sell. Second, that they were unable to do so.”

The sale halt shows that “either foreign investors find the shares expensive, or that the family members did not like what was offered,” said Isyar, who has a hold recommendation for Koc with a 12-month price target of 11 liras.

To contact the reporter on this story: Taylan Bilgic in Istanbul at tbilgic2@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

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