Teknosa Ic ve Dis Ticaret AS headed for the biggest gain in more than a week after a newspaper reported the Turkish consumer electronics retailer is in talks to acquire a competitor.
The shares rose 2.5 percent to 12.45 liras at the 12:30 p.m. midday break in Istanbul, poised for the largest advance since July 19. Teknosa was the fourth-biggest gainer in percentage terms on the Borsa Istanbul National 100 (XU100) index, which was little changed at 72,585.80 after a seven-day slump.
Teknosa, a subsidiary of Sabanci Holding AS (SAHOL), is in talks to buy Electro World Turkey, the Turkish unit of Dixons Retail Plc (DXNS), Vatan newspaper reported on July 27, without saying where it got the information. The companies signed a non-disclosure agreement and plan to complete the transaction in six months, Vatan said. The stock climbed 12 percent this month, compared to a 4.9 percent slump for the benchmark index.
“Investors are buying on the possibility that the company will be much more active in the industry after a possible acquisition,” Baris Ince, an analyst at BGC Partners in Istanbul, said by phone today. “If realized, such an acquisition would be positive for the company.”
In an e-mailed response, Teknosa’s investor relations department said “there’s no development necessitating us to make a statement.”
Demand for consumer electronics is growing in Turkey, where about six other retailers, including publicly traded Bimeks Bilgi Islem ve Dis Ticaret AS, also vie for customers in the country of about 76 million. Teknosa has 289 stores in Turkey and commands 42 percent market share, according to an investor presentation on its website. Electro World Turkey operates 33 stores in 22 Turkish cities, data on its website show.
Local demand for consumer electronics grew 23 percent last year to 15.1 billion liras ($7.9 billion), according to Teknosa estimates. The Istanbul-based company acquired five stores of Germany’s Electronic Partner in 2007 and the Turkish operations of Best Buy Co. (BBY) in 2011.
Almost 106,000 Teknosa shares traded today, 26 percent of the stock’s three-month daily average, according to data compiled by Bloomberg. Six analysts, including Ince, recommend investors buy Teknosa shares, while one says hold, according to data compiled by Bloomberg.
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