Germany's EWE Said to Get Binding Bids Soon for Turkish Assets
(Bloomberg) -- German utility company EWE AG is forging ahead with plans to sell Turkish assets even as the country goes through its worst currency crisis since 2001.
The Oldenburg, Germany-based company will collect binding bids for the assets of wholly owned subsidiary EWE Turkey Holding AS next month, according to four people with knowledge of the plan. The unit has almost zero debt, making it attractive for suitors, the people said, asking not to be identified because the talks are private.
While the sale could fetch around $300 million, the volatility of the lira -- which has lost over a third of its value this year -- could scupper a deal, two of the people said. EWE Turkey declined to comment.
The lira plunged after the U.S. sanctioned two Turkish ministers in a spat over the continued detention of an American pastor, with the contagion spreading to other emerging markets. This week, the central bank and other regulators have stepped in with measures to stem the currency’s slide, coaxing it back from a record low.
EWE Turkey owns two gas grids, in the provinces of western Bursa and central Turkey’s Kayseri, as well as Millenicom, a phone company. Its other assets include electricity trader EWE Enerji and Enervis, a technology service provider for the energy industry.
Potential bidders include local construction and energy group Kolin, Istanbul-based gas distributor Palmet Enerji and the State Oil Company of Azerbaijan Republic, or Socar, the people said. Some non-binding bids have already been received. EWE hired Barclays Plc to manage negotiations with suitors, people with knowledge of the matter said in March.
Kolin, Palmet and Socar also declined to comment.
EWE has been running the two gas grids since 2008, when it doubled its holdings by buying out its partner Calik Enerji AS for an undisclosed price. Calik Enerji has a 10 percent stake in both Bursa and Kayseri, while the local municipalities of the towns each hold the remainder.
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