Turkey's Oyak Group Seeking Opportunity to Return to Banking

(Bloomberg) -- Oyak Group, the conglomerate that manages pensions for Turkey’s military personnel and $18 billion in assets, is evaluating a return to the national banking sector, Chief Executive Officer Suleyman Savas Erdem said.

“We’re looking at opportunities,” Erdem, who took the job in May last year, said in written responses to Bloomberg questions. “If there are concrete developments, we’ll announce them with pride to our more than 300,000 members and to the entire country.”

Oyak operates a small bank in Germany, Anker Bank GmbH, but exited banking in its home country in 2007, when it sold Oyakbank to ING Groep NV of the Netherlands for $2.7 billion. The conglomerate is also active in cement, construction, mining, agriculture, steel, autos and energy.

The cement group is evaluating opportunities for acquisitions and investments abroad, Erdem said. The steel group, including Eregli Demir & Celik, or Erdemir, is investing in value-added, corrosive-proof steel that isn’t currently produced in Turkey. A second galvanized production line for Erdemir with 350,000 tons capacity will be active in 2018, he said.

Depleted Soil

The group’s listed agriculture unit, Hektas Ticaret TAS, has developed customized fertilizers to treat highly depleted Turkish soil, a product that Erdem described as “revolutionary.” He said faulty practices had left about 70 percent of Turkish agricultural land with organic content levels around 0.6 percent, when it should be 3 percent, and pH levels around 8 percent, when they should be 6 percent.

“We’re going to build a new plant in Adana that’ll produce organomineral fertilizer according to the needs of each region,” Erdem said. “We aim to change our farmers’ mentality from one of using fertilizer according to the product to one of using fertilizer according to the soil.”

In the automotive sector, Oyak is Turkey’s market leader through its ownership of rights to the Renault brand, Erdem said, increasing its market share in a shrinking market.

In August, Oyak made its largest real estate investment ever, purchasing nearly 800 million liras ($223 million) in land, in Ankara, Izmir and Yalova from Emlak Konut GYO. The company will build some 13,000 residences for its members on the land in Ankara and Izmir, as well as another 2,000 residences, logistical, industrial and R&D facilities in Yalova, Erdem said.

Oyak Group’s total revenue rose 9.3 percent in 2016 to 25.7 billion liras. Total assets increased by 25 percent to about 64.5 billion liras.

Original Story:
Oyak Grubu bankacılığa geri dönmek için fırsat arıyor

To contact the translator on this story: Benjamin Harvey in Istanbul at bharvey11@bloomberg.net.

To contact the translation editor responsible for this story: Benjamin Harvey at bharvey11@bloomberg.net.

Reporters on the original story: Kerim Karakaya in Istanbul at kkarakaya2@bloomberg.net, Ercan Ersoy in Istanbul at eersoy@bloomberg.net, Vernon Wessels in Johannesburg at vwessels@bloomberg.net.

Editor responsible for the original story: Benjamin Harvey at bharvey11@bloomberg.net.