Godiva chocolatier’s owner Yildiz Holding AS boosted the amount of cash it borrowed for the £2.1 billion ($3.3 billion) takeover of United Biscuits Holdings Ltd. after Turkish banks offered the company funds.
The Istanbul-based group is borrowing almost 90 per cent of the cash needed to buy the company from Blackstone Group LP and PAI Partners SAS, compared with an earlier plan to use loans for 40 per cent and the remainder from its own reserves.
The company received about half the total loan from a group of banks led by HSBC Holdings Plc, Cem Karakas, the company’s chief financial officer, said on a conference call. Rabobank Group, ING Groep NV, JPMorgan Chase & Co. and Bank of America Corp. participated in the syndication, he said. Domestic lenders provided the other half of the debt financing, with the company using 10 per cent of its own cash.
“After requests from some Turkish banks to participate, we also decided to borrow from the four domestic banks,” Karakas said. “The $1.6 billion that Yildiz had intended to use to pay for the acquisition remained almost entirely intact.”
Akbank, owned by Turkey’s second-largest group of companies, Haci Omer Sabanci Holding AS, provided $500 million for the acquisition, according to a statement from the bank today. Citigroup Inc. owns a 9.9 per cent stake in the Istanbul-based lender.
Biggest Acquisition
HSBC and Turkish investment bank Unlu & Co. advised Yildiz on the deal. The company will use part of the loans to refinance £670 million ($1.05 billion) of United Biscuits’ debt, Karakas said.
The acquisition price is the highest by a Turkish company for an investment abroad, according to data compiled by Bloomberg. The deal values United Biscuits at about 11 times its Ebitda of $300 million, Julien Martin, a London-based investment manager at Aberdeen Asset Management Plc., said last week.
Yildiz Holding, which has its own Turkish cookie business through Ulker Biskuvi Sanayi AS, will operate in 100 countries after the deal, Chairman Murat Ulker said last week. The company plans to grow in Latin America and Russia, two large markets where Ulker and United Biscuits products aren’t yet sold, he said.
Bloomberg News, edited by ESM
