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Centricus, Turkey's Actus Eye $1 Billion Infrastructure Fund

Updated on
  • Private-equity fund to target infrastructure projects
  • Global Yatirim’s port unit plans $400 million investment

Centricus, a London-based buyout fund, and Turkish asset manager Actus Portfoy Yonetimi AS plan to raise as much as $1 billion within a year to invest in infrastructure projects.

The firms will apply to the Ankara-based capital markets regulator within two weeks to get approval to manage the fund, which will only consider long-term investments, said Baris Hocaoglu, chief executive officer of Actus, owned by Istanbul-based Global Yatirim Holding AS. They will start investing from an initial $250 million as soon as this year and will be backed by investors in the Gulf and several sovereign wealth funds, he said.

The companies are targeting investments and public-private partnerships in infrastructure such as toll roads and bridges in Turkey and the region, he said in an interview on Monday.

“Later, after the fund makes investments, we can have an initial public offering of the fund or its assets,” he said, adding that the managers will soon start marketing it.

Turkey’s government has been building large infrastructure projects through a build-operate-transfer model with private companies financing the projects and running them for 10 to 30 years. The projects include a new 10 billion euro ($12 billion) airport in Istanbul, a $7 billion toll road from Istanbul to the western town of Izmir, and more than 15 city hospitals under the public-private partnerships model worth more than $10 billion.

Hospital Investment

Centricus, formerly known as F.A.B. Partners LP, bought 30 percent of Global Yatirim, which has interests in ports, renewable energy and finance, for 245 million liras ($69 million) in June.

The firm, founded by former Deutsche Bank AG bankers Michele Faissola and Nizar Al-Bassam as well as Dalinc Ariburnu of Goldman Sachs Group Inc., bought U.S. private debt investment manager CIFC LLC for $333 million cash last year. It also advised SoftBank Group Corp., a Tokyo-based telecommunications and technology firm, on the acquisition of Fortress Investment Group LLC for $3.3 billion.

Actus, 90 percent owned by Global Yatirim and 10 percent by Turkey’s police pension fund, invested 60 million euros in equity and mezzanine funding in Turkey’s 600 million-euro Gaziantep hospital under the PPP model, Hocaoglu said. The investment gave Actus a 24.5 percent stake, he said. Samsung C&T Corp., Salini Impregilo SpA and Turkey’s Kayi are the other partners in the hospital joint venture.

Separately, Global Yatirim’s London-listed cruise ports operator, Global Ports Holdings Plc, is in talks with five ports in the Caribbean, with one of them close to agreement, Chairman Mehmet Kutman said in the same interview. It plans to invest at least $400 million in the next 18 months to 24 months to expand its port network, he said.

Shares Gain

Global Yatirim shares rose as much as 3.7 percent, the most since Sept. 11, to 3.68 liras in Istanbul, and was trading 3.4 percent up at 3.67 liras as of 4:27 p.m. in Istanbul on Tuesday. Global Ports Holdings fell 3 percent to 580 pence in London.

“Apart from our drive to invest in infrastructure, we are also aiming to expand our energy investments,” said Kutman. Global Yatirim’s energy unit aims to increase power production capacity, made up of biomass-fired and co-generation plants, to 250 megawatts by 2020 from 140 megawatts now, he said.

Global Yatirim, which expects “a large dividend payout” next year from its 2017 earnings after the proceeds from the initial public offering in May of Global Ports, will also sell several real estate properties in its portfolio, including a shopping mall in Van in eastern Turkey, Kutman said. It expects to cash in as much as 220 million liras, he said.

(Adds share price in paragraph under Shares Gain subheadline, information on energy investments.)
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