Malaysian utility partners with Turkish GAMA Enerji
AA - Malaysian national power producer Tenaga Nasional Berhad (TNB) has acquired a 30-percent stake in Turkish energy company GAMA Enerji for USD 243 million. TNB’s move secures a foothold in a key growth market with positive long-term prospects, as part of its strategy to expand overseas.
TNB’s investment will result in a strategic partnership that will allow it to pursue regional asset acquisitions, greenfield projects, portfolio optimization and supply market entry, the Malaysian company said in a press statement.
Commenting on the deal, which is subject to regulatory approval by the Turkish and Malaysian authorities, TNB president and CEO Datuk Seri Ir Azman Mohd said that Turkey was one of the largest power markets in Europe, and its electricity consumption has shown an impressive 6 percent average annual demand growth in the past 10 years.
GAMA Enerji currently has an 840MW natural gas-fired electricity generation plant and a 45MW wind farm under construction in Turkey, which will go live in the third quarter of 2016 and the fourth quarter of 2016, respectively.
Italian renewable energy company Exergy thrives in Turkey
Dünya – Attracted by Turkey’s geothermal energy potential, Italian engineering company Exergy’s investment in a turbine production plant in Izmir has made it the number-one supplier of geothermal power generation equipment in the country.
Exergy’s new production facility manufactures turbines for use in combined-cycle geothermal power generation plants. The company’s turbines are used in more than 60 percent of Turkey’s operational geothermal power plants.
Speaking of their production operations in Turkey, Exergy founder and CEO Claudio Spadacini said that the country’s geothermal potential was immense and that Turkey would continue to be the priority market for Exergy in the foreseeable future.
Exergy sources parts and components from Turkish companies. “Our plant in Izmir has a localization ratio of 60 percent,” he said.
Spadacini also said that Turkey’s feed-in tariff for renewables favored locally produced equipment. “Energy projects using locally produced turbines benefit from higher rates when selling power to the national grid. That increases the feasibility of the project,” he said.
The Italian company also has a regional service center in Turkey, which is likely to become an export hub too, according to Exergy’s CEO. “Our focus is on the Turkish market but exporting to other countries from Turkey can be considered in the future,” he noted.
Turkey’s installed geothermal capacity exceeded 600 MW as of the end of 2014. With 225 surveyed sites, Turkey is thought to have www.invest.gov.tr
Foreign investors weigh heavy in Turkey’s M&A market in 2015
Dünya – The volume of mergers and acquisitions (M&As) in Turkey reached USD 16.5 billion last year, according to financial advisory firm Deloitte’s Annual Turkish M&A Review 2015.
Foreign investors accounted for 70 percent of the total volume of last year’s M&A deals, with their share increasing by 44 percent over the preceding year to reach USD 11.5 billion. Of the 245 transactions that took place in 2015, foreign parties were involved in 125, while Turkish investors underwrote the remainder. The number of M&A deals in 2014 stood at 236 while the volume was USD 21 billion.
In 2015, European investors made 62 M&As in Turkey, followed by 28 North American investors, 19 Far Eastern investors and 14 deals by Gulf investors. In terms of deal volumes, Gulf investors took the lion’s share with 39 percent, mostly due to sizeable Qatari investments in lender Finansbank, retailer Boyner and pay-TV network Digiturk.
Excluding privatizations, which took an 11 percent share of the total amount, 2015’s M&A volume was the highest in the past three years. Manufacturing, energy and services sectors were the top three in terms of deals while energy, financial services and infrastructure constituted the top three in deal value.
Foreign investors emerged as drivers in Turkey’s M&A market in 2015, according to Basak Vardar, Financial Advisory Services Leader at Deloitte Turkey when commenting on the study. Vardar, predicting that Turkey will retain its appeal for investors in the new year, pointed to manufacturing, energy, food and services sectors as primary points of interest in the M&A market in 2016.
Turkey tops Europe in commercial vehicle production
Sabah – The production of commercial vehicles in Turkey reached 408,000 units in the first nine months of 2015. According to data gathered by the Automotive Manufacturers Association (OSD), Turkey’s production of commercial vehicles increased by 34 percent over the same period of 2014, outpacing Spain to reach the top spot in Europe.
Automotive plants in Turkey rolled out a total of 974,000 vehicles in the January-September period, ranking sixth in Europe.
Ford, Fiat, Hyundai, Renault, Toyota, Honda and other carmakers have production operations in Turkey where they utilize the country’s skilled labor force and strategic location to reach regional and global markets.
Automotive exports generated income of USD 22.8 billion in 2014 with more than 885,000 vehicles produced in Turkey exported.
Turkey’s GDP growth rate hits 4 percent in 3rd quarter
Turkey’s GDP continued growing for the 24th consecutive quarter beating market expectations by a large margin, according to data released recently by the Turkish Statistical Institute.
The economy grew by 4 percent in the third quarter of 2015 compared with the same period last year and surpassing market expectations of 2.8 percent. The figure may cause an upward revision to Turkey’s overall annual growth forecast of 3 percent for this year. The country's economic growth rate for the first three quarters of this year was 3.4 percent, while it was 2.9 percent in 2014.
Turkey’s Minister of Finance Naci Ağbal said that the latest figures came amidst a turbulent regional setting and increasing global uncertainties. “With political stability restored by the November 1st elections the real sector and consumer confidence increased rapidly. The high growth performance in the third quarter points to an annual growth rate that could surpass the medium-term program goal of 3 percent,” he said.
Qatari Bank acquires Turkey’s Finansbank
Sabah - Qatar National Bank (QNB) announced the acquisition of 99.81 percent of shares in Finansbank, a major lender in Turkey with 647 branches and more than 13,000 employees.
QNB, the Gulf nation’s largest bank, agreed to pay EUR 2.75 billion to the National Bank of Greece, the current owner of Finansbank. The deal, expected to be completed by mid-2016, is subject to approval by Turkey’s regulatory authorities.
A crisis-tested financial system and a profitable banking sector have encouraged many new lenders to enter Turkey in recent years.
Another Qatari bank, Commercial Bank of Qatar (CBQ), acquired majority stakes in Alternatif Bank or Abank, in 2013, becoming the first Qatari lender operating in Turkey. Burgan Bank of Kuwait, which acquired Eurobank Tekfen for USD 349 million in 2012, and Bank Audi of Lebanon, which operates in Turkey under the name of Odeabank after receiving its banking license from Turkey’s regulatory authority in 2011, are among the entrants to Turkey’s highly lucrative banking market from the Middle East region.
FDI inflows into Turkey exceed last year’s total in nine months
Turkey received USD 12.61 billion in foreign direct investment (FDI) in January-September, up 32 percent over the same period of the previous year.
According to data from Turkey’s Central Bank, USD 791 million in FDI entered the country in September, bringing the January-September total to 12.61 billion.
The financial services sector emerged as the leading recipient of FDI in September. The top-three recipient sectors in January-September were financial services, manufacturing and energy.
Arda Ermut, the President of the Investment Support and Promotion Agency of Turkey (ISPAT), said that despite two general elections and the ongoing turmoil in some neighboring countries, Turkey has managed to increase its investment attractiveness to international investors.
“FDI into Turkey surpassed last year’s total amount in just nine months, raising our hopes to exceed year-end expectations. The results of the November elections clearly demonstrate our nation’s strong inclination towards stability while highlighting Turkey’s position as an ideal investment destination. These developments will reflect better on FDI figures in the coming months”, the ISPAT President noted.
FDI inflow into Turkey reached USD 12.5 billion in 2014.
Turkey’s ‘Mega Projects’ propel the country towards 2023 targets
Star – Large scale infrastructure, energy, and transportation projects throughout Turkey are progressing rapidly.
Designed to contribute to the 2023 vision, which is a set of goals to be reached by the Republic of Turkey’s centennial in 2023, these projects represent the culmination of the giant leap taken in the last decade towards a well-developed and prosperous Turkey that seeks to count itself among the world’s top 10 economies.
Exceeding USD 100 billion in total worth, the highways, bridges, airports, power plants and other mega projects remain on schedule. In addition to infrastructure related projects, rapid progress is also being made in the development of domestically designed and produced automobiles and aircraft.
Akkuyu Nuclear Power Plant
Rising in Mersin on the Mediterranean coast, the construction of the hydraulic facilities of the Akkuyu Nuclear Power Plant began in April, 2015. Scheduled to go online in 2020, the USD 22 billion project is being built by the Russian state-owned nuclear energy corporation Rosatom utilizing the latest technologies and safety features.
Looking to diversify its sources of energy and reduce dependence on imports, Turkey plans to have three operational nuclear power plants by 2023. A French-Japanese consortium will build the country’s second nuclear power plant in Sinop on the country’s Black Sea coast, while a third plant is in the planning stage.
North Marmara Highway - Yavuz Sultan Selim Bridge
On schedule to be completed by the end of 2015, the North Marmara Highway Project will boast the world’s widest and longest combined road and rail bridge, the Yavuz Sultan Selim Bridge. The Yavuz Sultan Selim Bridge will become the third bridge to span the Bosphorus strait, adding yet another link between Europe and Asia.
The USD 4.5 billion highway will link the Marmara Sea ports of Tekirdag with the major industrial center of Sakarya, considerably shortening the route between the two while allowing the freight transportation to bypass Istanbul’s busy city center. The highway lies adjacent to Istanbul’s third airport, which is under construction in the northwestern section of Istanbul’s European side.
Istanbul’s Third Airport
Istanbul’s third airport, set to be one of the largest in the world in terms of passenger capacity, is under construction in the Arnavutkoy district of Istanbul. Tendered to a consortium of five Turkish companies, Cengiz-Kolin-Limak-Mapa-Kalyon, for EUR 22 billion in May, 2013, the airport project will be realized through the built-operate-transfer method and is currently expected to cost an additional EUR 10 billion to complete.
Once complete, Istanbul’s third airport will relieve the heavily congested Ataturk Airport, becoming both the main hub of Turkish Airlines (THY) and a new layover location for a multitude of airline companies given its prime location between Europe, Asia, Africa and the Middle East.
Canal Istanbul is an artificial sea-level waterway that will be built parallel to the Bosphorus and will connect the Black Sea to the Sea of Marmara. At a planned 47 kilometers in length and 150 meters in width, Canal Istanbul will provide relief to shipping traffic, particularly oil tanker traffic, passing through the Bosphorus. The canal has a designed capacity of 160 vessels a day and is scheduled to be completed by 2023 at a cost of USD 15 billion.
Trans-Anatolian Pipeline Project (TANAP) and the Turkish Stream
Designed to carry natural gas from Azerbaijan’s Shah Deniz field to Turkey and beyond, the Trans-Anatolian Gas Pipeline’s (TANAP) construction is progressing rapidly. The first flow of gas through the USD 12 billion pipeline project is expected to start by 2018.
TANAP will connect to the Trans-Adriatic Pipeline (TAP) on the Turkish-Greek border and is expected to have an annual throughput of 31 billion cubic meters by 2026.
Apart from TANAP, Turkey and Russia have reached an agreement on a gas pipeline project dubbed ‘Turkish Stream’, which will carry natural gas from Russia to Turkey and onwards to Europe by crossing under the Black Sea. This pipeline is expected to have an annual throughput of 63 billion cubic meters.
Linking suppliers in the East and customers in the West, both projects will increase Europe’s energy security while bolstering Turkey's role as an international energy hub.
Eurasia Tunnel and Marmaray
The Eurasia Tunnel is the key component of a motorway that will allow drivers to cut the travel time from Kazlicesme on the European side to Goztepe on the Asian side of Istanbul to 15 minutes. To be opened later this year, this two-deck tunnel will pass under the Bosphorus and will have a capacity of 120,000 vehicles per day.
Once complete, the Eurasia Tunnel will complement the Marmaray, another undersea tunnel already in operation linking the European and Asian sides of Istanbul via a rail line.
Istanbul Finance Center
Ground has been broken for the project that will turn Turkey’s megacity into an international finance center. The city of 15 million inhabitants is already a major center of trade and business and is perfectly suited to assume the role of an international finance hub with its well-regulated markets, a vibrant economy, solid banking system, skilled labor force and advantageous geographical location.
Aiming to provide services in all segments of the finance sector, the integrated complex on the Asian side of Istanbul will span over 2,500,000 square meters of land. It will comprise office space, residences, a conference hall, a shopping mall and a hotel.
On schedule to be completed by 2018, Istanbul Finance Center will also house the head offices of the country’s governing bodies of financial markets, state-owned banks, and related businesses.