Turkish jeans retailer Mavi to list on Istanbul bourse

Turkish clothing retailer Mavi Giyim plans to list on Istanbul’s stock exchange, the company has confirmed, in what will be a test for the exchange 10 months after a coup attempt.

Chief Executive Officer Cüneyt Yavuz said 82 percent of Mavi’s business comes from Turkey, which has a growing and young population.

Borsa Istanbul, the Istanbul stock exchange, has seen a sharp decline in listings as $14.3 million have been raised in IPOs so far this year, compared with $119.9 million in the same period last year, according to Thomson Reuters data.

Yavuz said there had been more alarming news out of Turkey than expected, but added: “Our company has come out to be very resilient in terms of the ups and downs of the Turkish market.”

Last year Mavi, which was founded in Istanbul in 1991 and has become one of Turkey’s best known clothing brands abroad, gained over a million new customers in Turkey and 30 percent of those were under the age of 24, Yavuz said. It achieved a consolidated revenue of 1.31 billion lira ($368.11 million) and an EBITDA - earnings before interest, tax, depreciation and amoritisation - of 170.2 million lira in the 2016 financial year.

Yavuz declined to disclose the target valuation but said the company viewed Inditex and H&M as comparable, as well as local players. H&M is trading at enterprise value to EBITDA ratio of 8.6 for the next 12 months, while Inditex is at 17.6.

Mavi has nearly 400 shops and a presence in some 35 countries. Yavuz said Mavi is opening up bigger stores and growing the existing stores while expanding its foothold in the United States, Canada, Germany, Russia.

The offering will see 50 percent of the company sold by the founding Akarlılar family and Turkven, a private equity fund which invested in Mavi in 2008. They may also sell up to an additional 15 percent, Mavi said.

Turkven also holds investments in shoe retailer Flo and fast fashion chain Koton. Mavi shares will be offered to international institutional investors, and domestic retail and institutional investors, Mavi said.