BASEAK and Dentons have advised Entek Elektrik Uretimi A.S., a subsidiary of Koc Holding, on its acquisition of the Menzelet and Kilavuzlu hydropower plants from Turkey's Privatization Administration. The lenders of the project, a syndicate of Turkish and international commercial banks and EBRD, were represented by Clifford Chance and Yegin Ciftci Attorney Partnership.
The financing package of about TL 1.5 billion (equivalent to USD 375 million) will be provided partly in lira and partly in dollars by the EBRD and other commercial banks, including Garanti Bank, Isbank, Akbank, Yapi Kredi, Unicredit, and ICBC Turkey.
Entek Elektrik launched its investment in 1995 and started generating electricity at the end of 1998. Their first plant, which had a capacity of 104 MW, was built at the Bursa Demirtas Organized Industry Site.
With this deal, Entek Elektrik, the winning bidder of a competitive privatization tender worth TL 1.276 billion, takes over the operating rights of the two hydropower plants in Kahramanmaras province in the southeastern part of Turkey: Menzelet, with a capacity of 124 MW, and Kilavuzlu, with a capacity of 54 MW. Entek Elektrik’s installed capacity increases as a result from 244 MW to 422 MW.
According to Baseak, Koc Holding, which was founded in 1926, is "one of the largest industrial and services group in terms of revenues, exports, taxes paid, share in Borsa Istanbul’s market capitalization, and employment generation.” It operates in energy, automotive, consumer durables, and finance. The energy segment operates in refinery, fuel distribution, LPG distribution, power generation, and natural gas, among other industries.
According to Clifford Chance, "the privatization of Menzelet and Kilavuzlu hydroelectric power plants is the largest acquisition to date of hydroelectric power plants by a domestic investor in Turkey — thus the privatization is an important step towards the future goal of all electricity being generated by private suppliers."
Dentons Partner Tamsyn Mileham advised Entek Elektrik on English law matters, while BASEAK Senior Partner Mufit Arapoglu and Counsel Ceren Su and Senior Associate Arzu Inoglu advised on Turkish law matters.
Clifford Chance's team was led by London-based Partner Simon Williams, assisted by Senior Associate Rebecca Shepherd, while the Yegin Ciftci team was led by Partner Mete Yegin, assisted by Senior Associate Sait Eryilmaz and Associate Seda Isinman.