TAV Airports acquired 35% of Havaş shares from İş Private Equity and HSBC Investment Bank Holdings for a total consideration of €80 million.
TAV Airports bought 35% shares of Havaş (Havaalanları Yer Hizmetleri A.Ş.), the leading ground handling services provider in Turkey from İş Private Equity, an indirect affiliate of İşbank (Türkiye İş Bankası A.Ş.) and HSBC Investment Bank Holdings in exchange for a total consideration of €80 million.
The statements regarding the subject are as follows:
Dr. Sani Şener, CEO of TAV Airports “Today marks an important milestone in the history of HAVAŞ, Turkey’s first and foremost ground handling services company, which currently serves at 23 airports in Turkey. Three years ago we sealed a partnership with two highly reputable partners, İş Private Equity and HSBC Principal Investments to support HAVAŞ’s growth ambitions under TAV Airports management. With this transaction we injected €102 million into TAV Airports Holding. During these three years, together with our financial partners we have managed to turn HAVAŞ into a multinational ground handling company that is clearly uncontested in its home country. With the addition of Turkish Ground Services (“TGS”) to its subsidiaries, HAVAŞ has more than doubled the number of aircraft it serves in the Turkish market. On the other hand, the acquisition of HAVAŞ Europe has turned HAVAŞ into a multinational ground handling company providing service in six countries. As HAVAŞ has blossomed into a more commanding and diversified asset in the ground handling sector, our expectations from the future performance of HAVAŞ have never been higher. We are hence very pleased to take over HAVAŞ fully at this point in time. Our partnership with HSBC Investment Bank Holdings and İş Private Equity has indeed been a very fruitful one.”
Dr. Ahmet Erelçin, Managing Director of HSBC Principal Investments, Vice-Chairman of Board of Directors of HSBC Portföy Yönetimi A.Ş., which provided consultancy services to HSBC Investment Bank Holdings during the sale process, drew attention to Turkey’s growing importance each passing day towards becoming a regional transportation hub and spoke as follows regarding the acquisition: “We have invested in with a mission to support Havaş to keep up its strong performance on the back of the significant progress recently demonstrated by the Turkish aviation sector. As planned, Havaş’s buoyant position in its sector and its dynamic business model have allowed the company to reach a higher plateau in a very short time. The unique collaboration realized together with the dynamic TAV family has led to mutually beneficial results for all parties.” Mr Erelçin continued “Havaş makes significant contribution to the development of the Turkish aviation sector, as can be understood from the superior performance it has demonstrated under the roof of TAV Airports and a number of international quality awards it holds. In addition to this added value, Havaş helps Turkish aviation to attain prominence at the international arena by exporting the experience and knowledge it holds through its international subsidiaries”.
Murat Özgen, CEO of İş Private Equity said, “Our investment in Havaş has been an example of us fulfilling our goal to provide support to companies which create value for the Turkish economy.
It has been a real pleasure working in this industry together with such a strong partner and we are very happy to have contributed to the transformation process of Havaş. We hereby would like to thank TAV Airports and Havaş together with the management team for having successfully coordinated this process.
It has been such a remarkable decade for the Turkish aviation industry during which we have witnessed a quicker-than-the-eye liberalization process and consecutive years of double digit growth. The industry has proved resilient even during the global economic crisis starting in 2008 and has demonstrated 15% compounded annual growth rate between 2002 and 2011. This has eventually increased the appetite for foreign investment, as a result of which, Aéroports de Paris Group has acquired 38% of TAV Airports in May 2012, a landmark investment in the sector that coincided with the attainment of our business plan goals at Havaş. Havaş and its subsidiaries have almost doubled the number of aircraft they served and number of countries served from two to six during our partnership with TAV Airports.”
About TAV Airports Holding
TAV Airports, the leading airport operator in Turkey, operates 12 airports: Istanbul Atatürk, Ankara Esenboga, Izmir Adnan Menderes Antalya Gazipasa in Turkey, Tbilisi and Batumi in Georgia, Monastir and Enfidha in Tunisia, Skopje and Ohrid in Macedonia, Medinah in Saudi Arabia and Riga (only commercial areas) in Latvia.
TAV Airports provides service in all areas of airport operations such as duty free, food and beverage, ground handling, IT, security and operations services. The Company and its subsidiaries, provided service to approximately 451 thousand flights and 53 million passengers in 2011. The Company’s shares are listed in the Istanbul Stock Exchange since February 23, 2007, under the ticker code “TAVHL”.
About Havaş – Havaalanları Yer Hizmetleri A.Ş.
Havaalanları Yer Hizmetleri A.Ş. (Havaş) is Turkey’s first and foremost ground handling services corporation which currently serves at 23 airports/airdromes. Established in 1933 by the state as a state owned company to offer Ground Handling and Catering Services, the company has been continuing its operations under Havaş brand as the most experienced company in the Turkish ground handling services sector since 1987, when catering services were separated. In 1995, Havaş became the first and most successfully privatized company in Turkey. TAV Airports purchased 60% of Havaş in 2005, remaining shares of which were acquired by TAV Airports by the end of 2007.
Primary ground handling services provided by Havaş include; passenger, ramp, cargo & mail, load control & communication & flight operations, representation & supervision services. Havaş also handles airport transfers offering optimum comfort by luxurious buses and in order to provide the best and highest quality, fastest service; Havaş also offers warehouse services.
Owning 67% shares of HAVAŞ Europe in its partnership with Baltic Aviation Systems, HAVAŞ provides ground handling services in Latvia, Sweden, Finland and Germany.
Turkish Ground Services (TGS)
Turkish Ground Services (TGS) was founded as a partnership between Havaş and Turkish Airlines, who wanted to carry out its ground handling services under a separate roof. Starting its operations in January 2010 initially at Istanbul Ataturk, Ankara, Izmir, Antalya and Adana Airports, TGS commenced its Sabiha Gökçen Airport operation in July 2010. TGS offers all ground handling services at international standards with more than 3 thousand pieces of equipment and about 7 thousand employees.
Cyprus Airport Services (CAS)
Havaş and Cyprus Turkish Airlines founded CAS as a 50-50 partnership to manage ground handling services in Cyprus. CAS has been providing ground handling services at Ercan Airport since 2008.
About HSBC Principal Investments
Headquartered in the UK and operating in the private equity sector for 40 years, HSBC Principal Investments makes investment through HSBC Investment Bank Holding plc. With its branches in the UK, Middle East, India, Hong-Kong, Latin America and Northern America, HSBC Principal Investments’ total investment portfolio exceeds US$ 11 billion.
HSBC Portföy Yönetimi A.Ş.:
Established in Turkey in 2005 as a subsidiary of HSBC Bank A.Ş., HSBC Portföy Yönetimi A.Ş. operates in such fields as fund management, private portfolio management and private equity investment consultancy. The total size of funds managed by HSBC Portföy exceeds $ 1.2 billion.
About İş Private Equity
Established as a subsidiary of Isbank in October 2000, and floated on the Istanbul Stock Exchange in September 2004, the goal of İş Private Equity (İş Girişim Sermayesi Yatırım Ortaklığı A.Ş.) is to provide companies that operate in high growth sectors and have a competitive advantage, with capital and management know-how in order to support them during the execution of their projects.
İş Private Equity is especially interested in firms that operate in high growth sectors and command competitive advantages and a transparent management approach. It has provided US$81.5 million in funds to 13 companies by investing capital; 3 companies in information technology sector (Probil, ITD ve Nevotek ), 4 companies in services (Tüyap Fair and Exhibition, Beyaz Fleet Rental, Havaş, Aras Kargo), 3 companies in healthcare (Orsem Orthopaedic, Turkmed Dialysis Services, Dr. F. Frik Pharmaceutical), 2 companies in retail (Cinemars Cinema Chain, Step Carpet Retail) and 1 in construction insulation materials (ODE Insulation). Taking into account the financial debt the companies obtained with the support İş Private Equity during the partnership phase, İş Private Equity facilitated its portfolio companies, and hence the Turkish economy to raise a total capital of US$ 309 million.
With the Havaş transaction, the number of exits İş Private Equity has made to date has increased to nine.
Cinemars; August 2006
Tüyap Fuarcılık; February 2007
Beyaz Fleet Rental; June 2008
Step Carpet Retail; July 2008
ITD; July 2010
Dr. F. Frik; September 2011
Probil; October 2011
Ode Yalıtım; March 2012
İş Private Equity has earned a total of US$94.91 million from the sale of these 8 investments with 22.6% IRR and 1.9x capital invested.