March 14, 2018 / 2:54 PM / 4 months ago

UPDATE 1-Turkey's Gozde to hold IPO for up to 35 percent of retailer Sok

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ISTANBUL, March 14 (Reuters) - Turkey’s Gozde Girisim will hold an initial public offering for up to 35 percent of its discount retailer unit Sok Marketler, it said on Wednesday, in what is widely expected to be one of Istanbul’s top flotations this year.

Sok, with more than 4,700 stores and 21,000 employees, is one of Turkey’s biggest discount retailers, selling groceries, fresh produce and household items. The listing could be worth at least $700 million, a source told Reuters last month.

The IPO would be completed in May 2018, with the majority of the proceeds to be used to pay back debt, according to a draft prospectus filed with the Istanbul stock exchange. The IPO would be for 18.75 percent of Sok, with an offer of an additional 16.25 percent, Gozde said.

Gozde Girisim is the investment arm of food giant Yildiz Holding, the owner of Godiva chocolate and McVitie’s biscuits. It owns 39 percent of Sok. A Netherlands-based investor consortium owns another 50 percent, while a private equity fund run by Templeton Asset Management holds 10 percent.

Shares of Gozde Girisim fell more than 5 percent in Istanbul trade and were at 5.29 lira at 1428 GMT. The are down nearly 7 percent so far this year after more than trebling last year.

Sok is one of four Turkish firms all expected to hold IPOs in May, two sources told Reuters last month, as Turkish companies take advantage of stock prices near record levels and robust international demand for Istanbul equities.

Already this year, Turkey has seen IPOs from energy firm Enerjisa Enerji, private hospital MLP Saglik Hizmetler and port operator Trabzon Port raising a combined $762 million.

Clothing firm DeFacto, high-end retailer Beymen and logistics company U.N. Ro-Ro are also expected to hold initial public offerings, the sources told Reuters last month.

Sok had a net sales income of 9.51 billion lira ($2.45 billion) in the year to end-December, a 41 percent annual increase, according to the draft prospectus. ($1 = 3.8800 liras) (Reporting by Oben Mumcuoglu; Writing by Daren Butler and Ezgi Erkoyun; Editing by David Dolan)

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