TAI prepares to offer its 20 pct stake to public next year

ANKARA - Reuters

TAI is developing attack helicopters with Italian Agustawestland for the Turkish military. 2012 will be a delivery year for TAI’s ongoing projects, its general manager says. AA photo

Turkish Aerospace Industries (TAI) is set to offer up 20 percent of its stake via a capital increase in the first quarter of 2013, according to the company’s general manager.

During a trustees meeting in May, the board chose İş Yatırım, an affiliate of İşbank, to oversee the public offering process, General Manager Muharrem Dörtkaşlı told Reuters, adding that studies regarding the timing of the transaction were continuing.

“We will prepare the entire legal and financial infrastructure [regarding the public offering]. When the juncture is said to be favorable, İş Yatırım wants 12 to 16 weeks [to carry out the process],” said Dörtkaşlı.

“We will hold fire after we complete our preparations around the end of the summer. The stakes may be offered at the end of the year or in the first quarter of next year as far as [the markets are considered]. The first quarter of the next year has become more likely,” he said.

The Turkish Armed Forces Foundation, the Defense Ministry Undersecretariat and the Turkish Aeronautical Association are among the stakeholders in TAI.

TAI’s value varies between 1.2-2 and 2.5-3 times the book value depending on the method of estimation, Dörtkaşlı said, adding that he forecast that the value would hit more than 2.5 times the book value if market conditions improved.

The valuation of the company will be around a few billion dollars, he told Reuters in May, adding that the company may use the proceeds to acquire firms from abroad.

Touching on how TAI will make use of the public offering revenue, he said, “We are considering acquiring companies with strong books of orders in the civil aviation industry.”

TAI may use the money to buy firms that own products or structural manufacturing companies, he added. Noting that TAI was looking into companies abroad, he said: “[The target companies could be] suppliers of Airbus in Europe or of Boeing in the United States. They could be from the Benelux [countries], Switzerland, France, Spain, Italy or the States.”

‘Delivery year’

Dörtkaşlı said 2012 was a critical year in terms of the projects TAI is working on. “We have named 2012 the ‘delivery year.’”

Noting that the physical development process of the unmanned aerial vehicle Anka had been completed, he said: “We will develop three Ankas according to the prototype development contract. We will prove that we have developed those vehicles. We will confirm it in early July.”

There is a great deal of interest in Ankas from many Gulf and Arabian, Far Eastern and Turkic countries, as well as Pakistan, he said, adding that there were countries, particularly to the south of Turkey, that were close to signing initial agreements.

Dörtkaşlı said TAI’s turnover was expected to be near $1 billion this year after a successful previous year of $848 million. Noting that civil aviation was growing so quickly in Turkey that the country will need between 200 and 250 regional planes by 2023, he said TAI had held talks with Boeing and Airbus on the issue.