Turkey’s Dunyagoz to Start Talks on Selling Stake to U.S. Fund

  • Company chairman has been selling personal assets to pay debt
  • Dunyagoz is Turkey’s biggest chain of eye care hospitals

Turkey’s biggest chain of eye care hospitals plans to begin talks with a U.S. private equity firm on selling a stake of as much as 30 percent as it seeks to cut debt.

Dunyagoz Hastaneler Grubu, as the Istanbul-based chain is formally known, plans to restructure loans and is seeking to cut debt of 430 million liras ($127.7 million) by 250 million liras, Chairman Eray Kapicioglu said in a telephone interview on Monday. The company plans talks with the unidentified buyout firm in January to sell between a 25 percent and 30 percent stake and is also in talks with two U.S. hedge fund investors, he said.

The restructuring comes after the lira weakened 15 percent against the dollar in the past 12 months, and as analysts predict growth in the $720 billion economy will slow to about 3 percent this year, according to estimates in Bloomberg surveys. Dunyagoz has loans from Akbank TAS, TC Ziraat Bankasi AS and Odeabank AS, a unit of Bank Audi SAL of Lebanon.

“We are selling property and we are trying to minimize the amount to be restructured with the lenders,” Kapicioglu said. “We will start restructuring after asset sales are completed."

Villa Sale

Apart from the sale of personal property including a $30 million villa and $30 million car park in Istanbul, Kapicioglu has agreed to sell his personal stake in a power production joint venture, called Emba Power, to his partner Shanghai Electric Power Co. Ltd for $16 million, he said. The deal is expected to close in the first half of next month.
The outstanding debt includes an 86 million lira bond coupon payment due in August and $25 million to Turkey’s Eximbank, Kapicioglu said.

Dunyagoz has opened 10 new hospitals in Turkey with a total $135 million investment, which boosted its borrowings from the banks, Kapicioglu said. Earlier talks for a stake sale at Dunyagoz were halted amid political turmoil following a failed coup attempt earlier this year, he said.

“Foreign investors that we had been in talks with for a stake sale have stopped considering Turkey after the July 15 coup attempt,” he said. “But we are now restarting talks with them in the new year.”

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