A Turkish Private Equity Web Log

In an effort to cover the Turkish Private Equity Industry - for the promotion of Entrepreneurship, the private equity asset-investment model, and the communication thereof.

UPDATED: Islamic Bank Turkiye Finans Bought Out by Saudi National Commercial Bank; Deal with CBK and the Noor Group falls through
UPDATED: 19-7-2007
Saudi National Commercial Bank agrees to purchase 60% of Turkiye Finans for $1.08 billion, valuing the company at $1.8 billion. Boydak Holding and the Ülker Group will retain 20% each from the deal. The deal will be completed by the end of the year and could be revised up $120-130 million depending on profits. This post was originally written on the premise that CBK and the Noor Group were going to be purchasing 50% of Turkiye Finans, but it looks as though that deal was passed up for Saudi NCB.

Paul Wouters, a guest contributor on Dinarstandard.com, wrote a very nice piece on the Turkish Islamic Banking Sector (or Participation Banks as they call it). It comes on the heals of my last post about the IPO of Albaraka Turk Bank. It details nicely the success and potential success of the players in that space.

Indeed, the Islamic Banking sector (wiki), which does not charge interest under Sharia Law, has been a small but active sector. Orgininally, according to local newspapers, and as printed in Iş Banks Daily Market Review (July 3rd, 2007(pdf)), Turkiye Finans is to sell a 50% stake to the Commercial Bank of Kuwait (CBK) and Noor Group. UPDATE: This deal is now defunct. The deal is said to be around $1.8 billion for Turkey's 2nd largest Islamic bank (based on assets), and should be completed by the end of the month. This has come just a year and a half after the Ülker Group sold 50% of Family Finans to the Boydak Holding and Anadolu Finans, thus creating Turkiye Finans. Once the merger has been completed, I will update the post on banking acquisitions in Turkey.

Of the four Islamic banks in Turkey, two are now listed on the Istanbul Stock Exchange (IMKB) with Kuwait Turk Bank thinking about an IPO in 2008-2009. Bank Asya, was the first and one of the most successful IPOs to date and has also been one of the most profitable companies listed on the IMKB. Judging by the size of the domestic demand for Albaraka Turk, it doesn't seem like this sector is going to cool down anytime soon.

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