Godiva Owner Is Said to Pick BofA, JPMorgan for Grocery IPO

(Bloomberg) -- The owner of Godiva chocolates hired four advisers for an initial public offering of its Turkish discount-grocery unit that could raise about $800 million, according to people with knowledge of the matter.

Istanbul-based retailer Sok Marketler Ticaret AS is expected to be valued at about $2.5 billion, said two people, who asked not to be identified because the plan isn’t public. That compares with an estimate last month of more than $3 billion. No final decisions have been made and the valuation may change because it is still early in the process, the two people said.

Yildiz Holding AS, which owns a controlling stake in Sok, hired Bank of America Corp., Credit Suisse Group AG and JPMorgan Chase & Co. as global coordinators, said the people. The company also hired Istanbul-based investment bank Unlu & Co. as global bookrunner, they said.

Yildiz may sell as much as 30 percent of the company in the IPO, which is planned for the first half of 2018, said the people. Yildiz controls about 80 percent of Sok through its direct stake and indirect holdings via its private-equity arm, Gozde Girisim Sermayesi Yatirim Ortakligi AS, which owns about 39 percent. No decision has been made on whether the shares will be traded in London or Istanbul, they said.

Shares in Gozde rose as much as 9.8 percent to 4.91 liras, the highest intraday level since its initial public offering in 2010, before paring gains to trade 4.7 percent up at 4.68 liras as of 3:49 p.m. in Istanbul.

Increased Appetite

Yildiz, which also owns McVitie’s biscuit maker United Biscuits Holdings through its London-based Pladis Foods Ltd. unit, declined to comment, as did JPMorgan and BofA. Credit Suisse and Unlu didn’t immediately respond to requests for comment.

Turkish companies raised more than $500 million from IPOs this year, the highest level since 2011, and compared with $120 million in 2016, according to data compiled by Bloomberg.  

Emerging markets in Europe and the Middle East are seeing a flurry of IPO activity, with issuers including United Arab Emirates real estate developer Emaar Development PJSC and En+ Group Plc, the Russian power and commodities company controlled by Russian billionaire Oleg Deripaska, selling shares this year.

Sok, which competes against BIM Birlesik Magazalar AS, plans to add 1,000 stores this year, Yildiz Chief Financial Officer Mustafa Tercan said in August. Sales rose 44 percent to 3.9 billion liras ($1 billion) in the first half from a year earlier, while earnings before interest, tax, depreciation and amortization surged more than twofold. The company has about 4,700 stores in Turkey compared with more than 6,000 for BIM Birlesik Magazalar, the country’s biggest grocery chain by sales.

©2017 Bloomberg L.P.