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Dogus Holding, owned by the formerly secular but presently Erdoganist Sahenk family, and Yildiz Holding, owned by the Islamist Ulker family who recently had problems with President Recep Tayyip Erdogan, relaunched a second round of debt restructurings on already restructured loans to benefit from synthetically pressured interest rates.
The duo initiated the first round of debt restructurings in Turkey at the beginning of 2018.
Average interest rates on commercial loans in Turkey have eased from the 30% seen late in 2018 after the currency crisis to around 10-11% now​. Prior to the currency crisis they stood at around 18-20%.
Yildiz Holding told Reuters on February 10 that its discussions with banks were over lowering the interest rate on a syndication deal it made in April 2018.
It previously said ​the refinancing was worth around $5.5bn​ in that deal. Yildiz added that it was seeing interest in its new asset sales and that talks on
the issue were ongoing.
Dogus Group’s deputy chairman, Husnu Akhan, told the news agency the conglomerate was in talks with 12 banks to adjust the rate on ​a €2.3bn ($2.52bn) loan that it previously refinanced with their agreement last year​.
The operator of Istanbul’s new mega airport is reportedly in talks with Chinese banks led by Industrial & Commercial Bank of China to refinance €5.7bn ($6.2bn) of existing loans​.
IGA, as the company is known, said it’s aiming to seal a deal in the first half. It cited strong interest from China and the Middle East Gulf, but did not name any institution, according to a February 11 Bloomberg report.
Around half of the new borrowing could come from Chinese banks led by ICBC, while some banks on the original loans may also participate, a person familiar with the matter, asking not to be identified because the talks are private, was quoted as saying by the news service.
IGA has set out to capitalise on strong cash flows and falling construction costs in the development of Istanbul Airport to lower financing costs. European banks are also showing interest, IGA has said.
Istanbul Airport has faced substantial teething problems. An often heard complaint is that public transport links to the flight hub have not yet been finished, meaning many passengers are forced into expensive taxi rides. Another difficulty is that pilots often have to contend with strong winds coming off the Black Sea. There are ambitions to make the airport the world’s busiest, but plans that will enable the achievement of this distinction are not yet in evidence.
The company said in November that it was working with London-based Dome Group Financial Services on the refinancing. A deal would help IGA cut its annual interest burden “significantly,” it said at the time.
The operator sourced its original funding to construct the airport, located by the Black Sea outside Istanbul, from TC Ziraat Bankasi, Turkiye Halk Bankasi, Turkiye Vakiflar Bankasi, Denizbank, QNB Finansbank and Turkiye Garanti Bankasi in 2015 and 2018. Both loans mature in 2031, according to data compiled by Bloomberg.
IGA has to pay a total €22.1bn, or €1.1bn a year, for the 25-year contract to
33​ TURKEY Country Report​ March 2020 ​ ​www.intellinews.com