CEE & Turkey

20 Mar 2017   CEE & Turkey

Turkey Represents a Big and Difficult Call for Emerging Market Investors This Year

There are good reasons to be cautious around Turkey this year, given well-known concerns over security and domestic political stability exacerbated by polarisation as we head towards the scheduled referendum over the introduction of an Executive Presidency. Turkey’s well known Achilles heel, large external financing requirements (around US$200bn, double the country’s foreign exchange reserves), and associated concerns over rollover risks on around US$160bn in short-term debt liabilities, has not been helped by the recent sharp exchange rate drops or less-than-orthodox monetary policies from the CBRT, which are considered “opaque” by many.

CASE STUDY: Tofas Drives International Appetite for €200mn ECA-Backed Facility

Tofas Turk Otomobil Fabrikasi A.S. secured a €200mn ECA-back term loan facility against a backdrop of increasing emerging market volatility. The deal was critical for the development of the country’s automotive industry, and helped Tofas Turk finance the development of two new car models.

CASE STUDY: IC Construction Group Lays Groundwork for IPO with Project Finance Facility

IC İçtaş Enerji Yatırım Holding A.Ş. was able to utilise its close relationship with banks to rapidly close one of Turkey’s largest project finance loans of the year. The size of the project and the acquisition of two new HEPPs from the privatisation authority also managed to attract a larger group of lenders to the transaction.

CASE STUDY: Crescent Capital Cleans Up with Well-Structured Acquisition Finance Facility

Crescent Capital was able to secure a unique project finance facility within the Turkish markets with a mezzanine facility structured as a Murabaha commodity purchase tranche, achieving a long tenor, an uncommon feature in this market, and structured as a true non-recourse facility.

CASE STUDY: İstanbul New Airport Lands €4.5bn Project Finance Loan

İGA Havalimanı İşletmesi A.Ş set out to secure up to €4.5bn in a bid to build Turkey’s largest mega-project, a new airport in Istanbul that is set to become the world’s largest once complete, and achieved its key objective of structuring the deal with lender-friendly terms.

CASE STUDY: Galataport Secures €1.2bn to Finance Landmark Istanbul Development

Salıpazarı Liman İşletmeciliği ve Yatırımları A.Ş, a joint venture between BLG Gayrimenkul Yatırımları ve Ticaret A.Ş. and Doğuş Holding A.Ş, secured a 14-year €1.2bn project finance facility just one month after the Turkish coup attempt and without any guarantees from the Turkish government.

Are Rate Hikes Enough to Stabilise the Lira?

Turkey’s Central Bank pressed on with a 50bp interest rate hike in November despite persistent criticism from President Recep Tayyip Erdogan, and held its benchmark one-week repo rate at 8% at the latest meeting in January – despite market expectations. Analysts believe the move won’t be enough to stem the currency’s decline, with further rate hikes expected – which could provoke further intervention, hurting investment.

CASE STUDY: YDA Pushes Tenors on Local Currency Trade

YDA raised four-year money – pushing average tenors in Turkey’s local currency market – just one week after the coup attempt and two days after S&P downgraded the country’s sovereign credit rating to junk.

Infrastructure Outlook: From Small-Scale to Megaprojects, How Are Deals Getting Financed?

F. Mehmet Cosan, Chief Financial Officer and E. Murat Kosal, Managing Director of Otoyol talk to Bonds & Loans about new opportunities in Turkey’s infrastructure sector, and discuss the company’s structured funding programme for the Gebze-İzmir Motorway Project and the Osmangazi Suspension Bridge.

Hospital PPPs Part of a Much Wider Success Story for Turkey

A number of hospital-focused public-private partnerships attest to the success of Turkey’s healthcare development programme over the last decade, and deals like this could set the stage for a resurgence in new projects for years to come.

 

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