Turkey's Electronic Goods Retailer Vatan Is Planning IPO in May

Turkey’s second-biggest electronics retailer plans to sell shares through an initial public offering in May amid estimated sales growth of 20 percent, Chief Executive Officer Hasan Vatan said in an interview on Monday.

Vatan Bilgisayar Sanayi ve Ticaret AS, as the Istanbul-based seller of computers, mobile phones and other electronic home appliances is formally known, is in talks with potential advisers to manage the sale and expects to make a decision this week, Vatan said. The Vatan family plans to sell about 20 percent of the company’s shares in the offering, according to the CEO, who was also one of the company’s founders.

Turkey has seen a drought of IPOs this year as investors shied away from the country’s assets because of political uncertainty. Five smaller companies sold shares through an IPO this year, having a combined offer size of 36 million liras ($12 million), compared to 10 deals with 299 million liras a year ago, according to data compiled by Bloomberg. The market may revive in 2016 after the ruling Ak Party won a majority in Nov. 1 elections,
Sertac Karaagaoglu, director of listings at Borsa Istanbul, said at a conference in the city last week.

Sales are expected to increase 20 percent this year after 30 percent growth in 2014, Vatan said. Teknosa Ic ve Dis Ticaret AS, which had 3 billion liras of sales and 28.4 million liras of Ebitda in 2014, has the largest revenue among the listed electronics retailers in Turkey, according to data compiled by Bloomberg.

“The market in Turkey is relatively buoyant, especially when compared to much of western Europe and North America,” said Charles Allen, a senior analyst at Bloomberg Intelligence. “However, like other markets it is undergoing quite a lot of change, with the appliance and telecom markets quite strong and consumer electronics and IT much weaker.”

Apart from Teknosa, Vatan competes with Bimeks Bilgi Islem ve Dis Ticaret AS, which bought Turkish units of Dixons Retails Plc and Darty Plc in 2013, Media Markt Saturn SA and Gold Bilgisayar among others.

Turkey’s technical consumer goods market grew 16.8 percent in the second quarter of this year compared to a year ago and the overall market amounted to 10 billion liras at the end of the period, according to a GfK survey.

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