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Tekstilbank Set for Month-High on Takeover Bets: Istanbul Mover

Tekstil Bankasi AS (TEKST) headed for the highest level in a month after selling its headquarter at a profit almost double last year’s net income, stoking speculation of a takeover soon.

The shares of Tekstilbank, as the Turkish lender is known, rose 3.3 percent to 1.57 liras by 3:06 p.m. in Istanbul, set for its highest since Aug. 19. The trading volume was about 1.6 times the stock’s three-month average, according to data compiled by Bloomberg. Owner GSD Holding AS (GSDHO) climbed 3 percent, while the Borsa Istanbul National 100 index fell by less than 0.1 percent, the first time in three days.

The premises in Istanbul was sold for $62.7 million, according to a bourse filing after the market closed yesterday, generating a profit of 47.2 million liras ($24 million). Tekstilbank posted a net income of 26.1 million liras last year, the highest since 2007, data compiled by Bloomberg show.

“The bank is making a substantial profit from the sale,” Haydar Acun, managing partner at Sardis Securities Inc in Istanbul, said in e-mailed comments today. “Investors may be betting that a possible takeover of the lender is near and the prospective buyer may be preferring not to pay for the building.”

GSD Holding hired BNP Paribas SA to advise on a potential sale of “all or part” of its stake in Tekstilbank, according to a statement made to Borsa Istanbul on April 3. Tekstilbank and GSD officials did not immediately provide comment when contacted by phone and e-mail today. Industrial & Commercial Bank of China Ltd., China’s biggest lender by market value, was “rumored to be close to taking over” Tekstilbank, the Economist magazine said in a report dated May 18 without citing a source.

Tekstilbank reported a net income of 1.51 million liras in the second quarter, compared with 3.19 million liras a year ago. Its shares trade at 20 times estimated 12-month earnings, data compiled by Bloomberg show. That compares with a multiple of 9.3 for Turkish lenders Turk Ekonomi Bankasi AS (TEBNK), 7.3 for Sekerbank TAS (SKBNK) and 8.2 for the nation’s banking index.

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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