ISTANBUL AND LONDON, 2ND NOVEMBER 2006 – GE Real Estate Europe (“GE Real Estate”) and Dogus Holding A.S (“Dogus”) are pleased to announce that Garanti daBankası A.Ş has accepted their joint offer to acquire its 50.98% stake held in the publicly listed real estate investment trust, Garanti Gayrimenkul Yatırım Ortaklığı A.Ş (the “Garanti REIT”). The offer price, at YTL 1.928 per share, represents weighted average of the last 5 days’ trading price prior to the offer date, and amounts to a total transaction value of 72.5 million YTL, or US$50 million.
Garanti REIT is listed on the Istanbul Stock Exchange; symbol GRGYO, with a market capitalization of 136.7 million YTL, or US$94 million, as at 1st November 2006. This transaction marks GE Real Estate’s first investment in Turkey.
The price being paid by GE Real Estate and Dogus represents a company value of 142.2 million YTL ( US$ 98.07 million), a 36.9% premium to the Garanti REIT’s Net Asset Value as at 30 September 2006. Despite being in a position to ask for an exemption, the two parties will not seek this from the Capital Markets Board (the “CMB”) and, to the extent the CMB will allow a tender offer, all tender shares will be acquired. As per CMB REIT regulations, the public shareholding of a REIT should be at least 49% of the share capital; therefore, any additional shares of Garanti REIT acquired via a tender offer will be resold.
Garanti REIT, established in 1997, invests in commercial real estate assets and development projects in the retail and residential sectors. It currently owns six investment assets located in Istanbul and Antalya in Turkey and Bucharest, Romania. The largest asset in the portfolio is Doğuş Power Center (“DPC”) a retail development in the heart of Istanbul, comprising a 63,000 sqm power center with seven anchor tenants, due to be launched on 9 November 2006. The other assets include offices and a residential development in Istanbul.
Garanti Bankasi, which is the third largest private bank in Turkey, has been jointly owned by Dogus and GE Consumer Finance since December 2005. Garanti Bankasi has previously identified its investment in the commercial real estate sector as non-core to its main consumer banking, advisory and financial services activities. Although this transaction is viewed by GE and Dogus as an inter-company deal, the management team of the REIT welcomes the opportunity to work directly to grow this business with the two divisions which have a track record and direct interest in real estate.
In conjunction with this offer, Dogus and GE Real Estate will enter into a shareholders’ agreement that will form the basis for the management of the REIT going forward. Both parties view the Turkish real estate market as extremely dynamic with significant growth opportunities in the commercial, retail and residential real estate sectors.
Commenting on the deal, Olivier Piani, President of GE Real Estate Europe said, “Turkey is a very promising market for us and, through the acquisition of this stake, we are delighted to have made our first investment. Garanti REIT has a strong position in the market and a good portfolio of high-quality assets. We very much look forward to working with Dogus, and to benefiting from its significant local market knowledge and relationships as we grow the business into a major regional player.”
Mr. Husnu Akhan CEO of Dogus Holding added, "We are keen on deepening our partnership with GE and executing our Group's real estate growth ambitions via this transaction which is the first fruit of both sides' intention to work together in Turkish real estate, a market which we believe presents tremendous growth potential. The investment by GE Real Estate, one of the world's premier real estate companies, underlines the strength of the investment climate in our country and we hope to leverage the international expertise of GE Real Estate in growing the REIT.”
Dogus Holding contacts in Turkey
Semih Yalman/Secil Baykara, Doguş Grubu Binaları, Büyükdere Cad. No: 65 Maslak, 34398, Istanbul
Tel:+90 (212) 335 32 32 Ext: 3109 Faks: +90 (212) 285 40 05, email:
syalman@dogusgrubu.com.tr,
sbaykara@dogusgrubu.com.tr,
www.dogusgrubu.com.tr
GE Real Estate Contact: Stephanie Highett/Dido Laurimore/ Nicole Marino +44 20 7831 3113,
Stephanie.highett@fd.com, dido.laurimore@fd.com, nicole.marino@fd.com
About GE Real Estate
GE Real Estate (
www.gerealestate.com) is one of the world's premier commercial real estate companies with USD49 billion in assets and a presence in 24 countries throughout North America, Europe, Asia, and Australia/New Zealand. Backed by GE's AAA rating, GE Real Estate offers a comprehensive range of capital and investment solutions including equity capital for acquisition or development, as well as fixed and floating rate mortgages for new acquisitions or re-capitalizations of commercial real estate. With a 26% compound annual growth rate since 1993, GE Real Estate is one of the world's fastest growing and most profitable real estate enterprises. This extraordinary record of success grows out of a reputation for collaboration and partnership; a depth of knowledge and experience and a history of building relationships, finding opportunities and opening doors for more than 5,000 owners, builders, borrowers and brokers worldwide.
GE Commercial Finance (
www.gecommercialfinance.com) offers businesses around the globe an extensive array of financial products and services. With over US$215 billion in assets and expertise in the middle-market, GE Commercial Finance provides loans, operating leases, financing programs and innovative structured capital to help customers grow. Headquartered in Norwalk, Connecticut, GE Commercial Finance is a wholly owned subsidiary of the General Electric Company (NYSE:GE), a diversified services, technology and manufacturing company with operations worldwide.
Dogus Holding –
Doğuş Group is one of the largest conglomerates in Turkey with a vision to become a regional leader in the service sector. Doğuş Group is active in five sectors with high growth potential, namely finance, automotive, construction, tourism and media. With over 16 thousand workers serving more than 6 million customers, the Group uses its dynamic human resources and superior technological capital to create brand value that ensures customer loyalty. Dogus Group seeks leadership in its chosen core activities by developing synergies amongst the Group divisions as well as through global partnerships.
