EON, Sabanci Plan Turkish Power Grid IPO as Offerings SoarBy
Enerjisa plans to list shares in Istanbul in February
Turkish companies weighing IPOs as political uncertainty eases
EON SE and its Turkish partner plan to sell as much as 20 percent of their power distribution unit in an initial public offering on Borsa Istanbul in February as more Turkish companies seek to benefit from rising investor appetite.
The German utility and Turkey’s second-biggest business group Haci Omer Sabanci Holding AS, which each hold 50 percent of Enerjisa Enerji AS, will sell as much as 236.2 million liras ($61 million) worth of nominal-valued shares in the IPO, including an over-allotment, according to a draft IPO prospectus submitted to the capital markets regulator.
Enerjisa is pushing ahead with the IPO after plans to sell a stake stalled last September, people familiar with the matter said at the time. The company had planned to sell shares to cut its debt, which rose 11 percent to 7.3 billion liras in the first nine months of this year, Enerjisa said in the prospectus.
“The possible IPO of Enerjisa will improve the operational and financial position of the asset and increase the transparency” of Sabanci Holding’s portfolio, Mustafa Kucukmeral, an analyst at Is Investment in Istanbul, said by email. Is Investment, which has a buy rating on Sabanci Holding, values Enerjisa Enerji at $1.6 billion, he said.
Citigroup Inc., HSBC Holdings Plc and Bank of America Corp. are managing the sale for international investors, people with knowledge of the matter said in June. Enerjisa is also working with Ak Yatirim Menkul Degerler, an Istanbul-based brokerage, to manage the domestic sale.
EON and Sabanci plan to pay out 60 percent of its net income as dividend, pending approvals, according to the prospectus. The per-share price in the offering is yet to be determined.
Enerjisa’s nine-month net income rose 8 percent to 454 million liras, while sales rose 24 percent to 8.6 billion liras. Earnings before interest, tax, depreciation and amortization, or Ebitda, rose 23 percent to 1.51 billion liras.
Sabanci shares rose as much as 6.1 percent to 11.32 liras in Istanbul, the most in two years.
Turkish companies are considering share sales as political uncertainty subsides. The value of IPOs in 2017 already surpassed the last three years combined, according to data compiled by Bloomberg. Godiva chocolates owner Yildiz Holding AS is planning to list shares in discount retailer Sok Marketler Ticaret AS in London next year, people familiar with the plan said this month. TFI TAB Gida Yatirimlar AS, Burger King’s biggest franchisee outside the U.S., applied for an IPO in New York this week. Clothing retailer DeFacto also plans a listing in Istanbul.
“We are expecting the biggest IPOs in Turkish history in the next six months,” Mahmut Unlu, chairman of Unlu & Co., an Istanbul-based investment bank, said at a conference in Istanbul on Wednesday. “The amount of IPOs we are working on is in excess of $3 billion.”