Trendyol Seeks Over $1 Billion to Be Largest Turkish Startup
(Bloomberg) -- Turkish e-commerce firm Trendyol, which is backed by Chinese online giant Alibaba Group Holding Ltd., is seeking to raise more than $1 billion in a deal that could make it the country’s largest startup, people familiar with the matter said.
Trendyol is aiming for a valuation of at least $15 billion in the new round, the people said, asking not to be identified because the information is private. The fundraising is aimed at investors in the U.K. and the U.S. as the company looks to expand its international footprint, the people said.
Proceeds will be used to fund growth and diversify the firm’s shareholder base ahead of a potential initial public offering in two years, the people said.
Over the last three years, Trendyol grew its gross merchandise value by about 20 times and it’s on track to record about $10 billion GMV in 2021, the people said. The company aims to seek a valuation of about 1.5 times its GMV, the people said.
The valuation would not only make it Turkey’s largest startup, but also bring it ahead of steelmaker Eregli Demir ve Celik Fabrikalari TAS, also known as Erdemir, the most highly-valued company on the Istanbul stock exchange with a market capitalization of just over $8 billion based on today’s share price.
Alibaba recently invested another $350 million in Trendyol, raising its stake to almost 87% by acquiring about 3.7% in the company, according to Turkey’s commercial registry. The cash injection valued the company at about $9.4 billion, the people said.
The latest fundraising, which is expected to be completed soon, has already attracted interest from several top international investors including sovereign wealth funds, the people said. Citigroup Inc. is the sole adviser on the transaction, according to the people.
Tech companies in Turkey has attracted international investors in the past year, reaching valuations of a unicorn, the so-called definition of startups with at least $1 billion in value. Peak, a casual games maker, was sold to Zynga Inc. for $1.8 billion last year and Getir, a quick grocery delivery app, fetched $2.6 billion in its latest investment round from private equity firms in February.
Turkey’s e-commerce trade volume rose 66% to 226.2 billion liras ($27.4 billion) in 2020, according to data from trade ministry’s website.
Founded in 2010 by Harvard Business School dropout Demet Mutlu, Trendyol is Turkey’s largest e-commerce marketplace platform, according to its website. It enjoys 34% market share, according to Euromonitor data. Its top rival Hepsiburada has 11%, while n11.com has 8.3% and EBay Inc.’s GittiGidiyor unit has 4.4%.
Representatives for Trendyol and Citigroup declined to comment.
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