15 Turkish magnates: friends and enemies of Tatneft, acquaintance with IKEA and forgotten Ramstore
How the biggest business families of Turkey discovered Tatarstan
Russia-Turkey crisis is gathering speed. The day before the Russian government published a list of banned products: vegetables, fruits, salts and chicken. Meanwhile, Forbes posted data about the richest entrepreneurs of Turkey who have a business in Russia. Realnoe Vremya analysed this list and found out that almost all of them has links with Tatarstan.
1.The Koçs made their presence felt with Ramstore and fridges
The Koçs, the representatives of the richest family of Turkey, know about Tatarstan firsthand.
A meeting with these magnates in March 2006 can be supposed the first contact with them: Khafiz Salikhov, the Minister of Trade and Economic Cooperation at that time, met with heads of Koç in Istanbul. He showed a presentation of prospectives of the Special Economic Zone of industrial production called Alabuga.
Although, it was preceded by a fight for control over Turkish Tupraspetroleum refining plants. The consortium of Tatneft and Zorlu was trying to buy it, but all in all the Koçs got the plants near Izmir along with Shell.
Paterfamilias Mustafa Koç met with the President of Tatarstan in October 2012 or, more precisely, in 6 years. The representatives of Koç Holding were not the only participants of the meeting, other companies of the Turkish Group like Renaissance and Ford Otosan took part as well. Tatarstan was represented by Irek Faizullin, the Minister of Construction, Ravil Zaripov, the Minister of Industry, Sergey Kogogin, the director of KAMAZ, and Vladimir Busygin, the director of Nizhnekamskneftekhim. Minnikhanov offered Koç Holding to produce auto components in the region. The President of Tatarstan met with Turgay Durak, the head of the Koç Holding, in May 2012 in Turkey during the Tatarstan-Turkey Investment Forum.
In brief, Koç Holding is a large Turkish holding whose biggest companies produce domestic appliances: Arçelik (the brand is Beko) that manufactures Ford Otosan, TOFAS (with Fiat), Otokar bus producer, Migros chain of supermarkets and Tupras petrochemical company. According to Forbes, Koç family's worth is equal to about $8,35 billion. By the way, the goods of Beko are sold in Tatarstan. For instance, in shops of DOMO, as Realnoe Vremya was said, the brand of Beko is represented by fridges, washing machines, dishwashers, air conditioner, ovens, cooker hoods, hobs, heaters and boilers. But, in general, the share of Turkish brands in the assortment is not big, roughly 2%.
As for business, in Russia, the Koçs were famous for the gone chain of hypermarkets of Ramstore. But in our country the richest family of Turkey ran its business in partnership with another participant of the rating of Forbes – the Turkish company of ENKA. Ramstore at the height of its development in Russia had 10 shopping centres and 52 shops throughout the country. This chain was bought by Turkish ENKA in 2007. And in 2008 most shopping centres and shop were sold to the Groupe Auchan.
2. From Town Hall to stadium
Speaking about Turkish business, firstly, construction companies come to mind, and Renaissance Construction is one of the largest of them. Erman Ilıcak is the head of the company who came from ENKA (see below). It should be noted that Erman Ilicak, a Turkish engineer, founded Renaissance Construction in Saint Petersburg. According to its official site, the developer had 430 projects. The first large contract with Baltika Brewery signed in 1998 was the key moment in history.
In Kazan, it is known Renaissance Construction CJSC participated in the reconstruction of the Town Hall of Kazan. When Abdullah Gul, the President of Turkey, visited Kazan in February 2009, one question arose again: it would be good to provide the Turkish builders with contracts. But it didn't go beyond declarations.
In 2012, Erman Ilicak was the chairman of Turkish-Russian Business Council. During that meeting, Irek Faizullin, the Minister of Construction, invited Renaissance to join the construction of the Kazan Arena stadium. Minnikhanov additionally met with Ilicak in Saint Petersburg within the scope of the St. Petersburg International Economic Forum in 2014.
According to the data published by Forbes, Erman Ilicak's worth is estimated at $2,2bn.
3. Dogus was offered to build a spa on the bank of the Kazanka River and elite boutiques
Another large Turkish magnate on the list of Forbes is Ferit Faik Sahenk, the chairman of Dogus Holding. Dogus Holding headed by Sahenk specializes in different sectors of business: finances (Garanti Bank is the second largest bank of Turkey), automobile business (Dogus Otomotiv is one of the largest distributors of Volkswagen, Audi, Skoda Porsche, Lamborghini and other cars in Turkey), the media (over 20 TV companies and radio stations), tourism, construction and power engineering. Forbes estimates Şahenk family's worth at $5,96bn.
It is understood that such a large representative of the Turkish business couldn't take no notice of Tatarstan. He had a meeting with the President of Tatarstan in September 2014. No one knows what results were achieved at the end of the meeting. However, the press service of the head of the region reported that Sahenk expressed his gratitude for a warm reception and noted that the company was seriously tuned to common projects with the republic. In addition, he said that Dogus saw good opportunities for realization of common business projects, especially in tourism and construction.
Some additional details concerning the possible collaboration appeared in January 2015. Sergey Ivanov, the chairman of the State Committee on Tourism of the Republic of Tatarstan, met with representatives of Dogus Insaat, the largest construction company of Turkey. At the meeting they discussed an offer on the construction of a spa hotel near the Aquatics Palace in particular. The Turkish party expressed its interest in one of the projects included in the investment offers called '5 Winds' that presupposes a construction of a touristic and recreational cluster on the banks of the Volga and Kama Rivers. There will be Volga Manor House in Nariman village in Verkhneuslonsky District. Its natural bay for reception of cutters and yachts will allow to create an all-season health complex for people of substance. But against a background of Russian-Turkish Cold War, the collaboration is likely to be put on ice.
In Russia the business of Doĝuş, which is partly owned by Spain's BBVA, is represented by Garanti Bank Moscow and Crate and Barrel boutique. The latter opened in AFIMALL City in Moscow in 2014 within the scope of the common business with Park Avenue Group. At that time there were plans on expansion of the chain in Russia, opening of shops in some Post-Soviet countries and in 10 cities of Russia, including Kazan.
4. They brought IKEA to Kazan
The company headed by Sarik and Mehmet Tara is a large construction holding that started to work in Moscow in 1988 when ENKA took part in the reconstruction of Petrovsky Passage in Moscow. In Russia it is known, firstly, due to the construction of one of the complexes of Moscow International Business Center – Naberezhnaya Towers. Besides, it owns large shopping centres in Moscow: Kuntsevo Plaza, a chain of Kapitoliy centres, Krasnye Holmy hotels on Paveletskaya Street. Forbes estimates Tara family's worth at $3,6bn.
In Kazan ENKA constructed the shopping centre of IKEA for $12 million in 2003. According to the press, the representatives of the Turkish company actively lobbied the coming of the Swedish chain to the capital of the Republic of Tatarstan. What is more, ENKA became the owner of Ramstore chain (see Koç Holding). Mintimer Shaimiev, the first President of Tatarstan, took part in the opening of the first Ramstore in Kazan in 2003. The first shop of the chain, which was situated in the City-Centre next to Gorky metro station astonished the citizens of Kazan by its new format of hypermarket with a wide range of goods, low prices and territories that seemed to be huge. At the same time, the producers of Tatarstan were shocked that Ramstore required to get paid for being on the shelves. The Khairullin brothers even addressed a claim to the State Council of Tatarstan defending the interests of Edelveys and Krasny Vostok. The administration of the republic personally had to handle the problem. In 2008-2009, Ramstore began to close its shops in Kazan one after another, then left Tatarstan, and scrapped the project in Russia in the end.
5. Pharmacist and lover of volleyball from Eczacibasi Holding
Eczacibasi Holding is one the largest Turkish holdings in pharmaceutics, construction materials and finances. In 2011 and 2014, the company built two factories on the production of VitrA ceramic tiles.
In 2010, the holding opened a VitrA showroom on Dekabristov Street in Kazan. At that time, Ahmet Yamaner, a representative of the company, linked the opening of the shop on the region with plans for further development of the eve of the Universiade (Student Games). Nevertheless, at the moment it was not possible to find any information on the official site of VitrA concerning the official showroom, and in Kazan the distributors were Prime-Keramika and Monarkh-Kazan.
Forbes values Eczacibasi family's worth at $2,77bn. The holding is the sponsor of Eczacibasi Women's Volleyball Club from Istanbul, the namesake of the company, that played with the Russian Dinamo-Kazan.
6. Perpetual banker
Fiba Group owns Credit Europe Bank, one of the largest banks of Russia. This bank is an exclusive partner of the Groupe 'Auchan', IKEA and Metro Cash&Carry. The Dutch Credit Europa Bank B.V. is its formal owner. Husnu Ozyegin is a famous banker, the founder of the Group who created Finansbank, then sold it and returned to the banking business.
The Russian Credit Europe Bank has AutoPartners, a close company included in Fiba Group. The company offers a full-service operational leasing of cars and car fleet management for its clients. The fleet of the company is designed for 3,500 cars in 13 cities, including Kazan.
In Russia Fiba Group also have some brands of clothes such as GAP and Marks&Spencer (the latter left Kazan at the height of the crisis).
Husnu Ozyegin, the owner of Fiba Group, said in an interview with 'Vedomosti' in 2012 that he visited regions of Russia, including Kazan, for crediting large clients, first of all, automobile dealerships.
'I have quite many philanthropic projects in Turkey. We built over 70 schools and boarding schools for girls. Our Group realized a great project on creation of a university in Turkey four years ago: to day, 1,800 students study Business Administration, Hotel Administration and Law. And this university will grow. I transferred a volleyball coach from a university of Kazan for the women's volleyball team at women's university (smiling). But we also exchange professors and students,' said Ozyegin to 'Vedomosti' in 2012.
7. 'For a public hospital it is clean'
In 2013, the government of Tatarstan and the delegation of Acibadem Healthcare Company came to an agreement on construction of a new clinic of the company. The region offered to the representatives of the company several variants of its location: buildings of former health facilities, a part of an active health complex or a parcel to build a new building on. Mehmet Ali Aydinlar, the owner of the Group, came to Kazan and visited the Interregional Clinical Diagnostic Centre.
Ildar Khalikov, the Prime Minister of Tatarstan, promised the clinic 'a specific state order'. The representatives of the clinic had attended the Republican Clinic Hospital in 2010. Overall, the collaboration ended with intentions only…
Acibadem Healthcare is a company that owns a chain of clinics and deals with the organization of medical tourism. The company has its representative in Russia in Yekaterinburg. According to Forbes, Mehmet Ali Aydinlar's worth is $1,46bn.
8. Failures of ally of Tatneft
Zorlu Gurubu, the chairman of the board of directors, and Ahmet Nazif Zorlu, the owner of the company, can be called a good friend of Tatarstan. His multisectoral holding united a huge number of lines: home textile, electronics, IT, consumer durables, energy generation and distribution, financial services, etc. So, 65 companies, 21 of which are large industrial concerns, and 3 electric power stations formed part of Zorlu Holding.
Zorlu Holding is a large textile company of Turkey working under TAC brand name. Its factory is situated in Nizhny Novgorod. The holding also produces Vesteldomestic appliances, particularly in factories of Russia. The company manufactures refrigerators, washing machines and LCD televisions.
As Forbes estimates, Ahmet Zorlu's worth is $1,32bn.
Collaboration with Tatarstan began at the beginning of February 2004 when Zorlu holding Efremov Kautschuk Gmbh (City of Efremov, Tula Oblast), a company affiliated with Tatneft, won the tender on purchase of 66% of shares of Tupras, the largest Turkish petroleum refining holding, offering at that moment the highest price – $1,3bn. Tupras includes four petroleum refining plants, one petrochemical complex, and accounts for 85% of all petroleum refinery ofTurkey. But the tender was cancelled, and the petroleum refining plants were controlled by the consortium of Koç Group – Shell.
Rustam Minnikhanov and Ahmet Zorlu met in December 2014. The head of the region offered the manufacturer to create a textile cluster in Tatarstan. At the same time there were held negotiations in the administration of Generating Company PJSC with representatives of Turkish Corporate Group Zorlu Holding: Olgun Zorlu, a member of the board, Omer Yungul, the CEO, and Sinan Ak, the director general of Zorlu Enerji. They discussed a possibility of realization of common projects on construction of generating capacities in Tatarstan in particular.
9. Excavators in Yelabuga
Çukurova Group is the leading holding in the chemical industry, finances, construction and telecommunications, and its owner is Mehmet Emin Karamehmet. It is known due to a conflict with Alfa-Group as regards the Turkish mobile operator Turkcell.
Çukurova has collaborated with ElAZ Production Association since 2010. Rustam Minnikhanov met with Ali Samsa Karamehmet, the chairman of the board of Çukurova Makina and visited the unit of Çukurova that produces industrial equipment during his visit to Turkey in May 2014. The guests were showed a short presentation about the activity of the company.
Çukurova Makina is the brand of the industrial equipment that belong to Çukurova Group. The principal business of the company is concentrated on mechanical engineering, the construction industry, transport and power engineering. Çukurova Group includes 139 companies, including 19 companies with participation of foreign investments. The total turnover of the holding reached $4bn per year. The company was founded in 1968 and produced agricultural and harvesting equipment first under licence of American Corporation John Deere (USA). They have been elaborating a project along with German company Liebherr on the production of backhoe loaders in Cumitas factory in the city of Tarsus. Today productive capacity of the factory reaches 2,000 articles of equipment.
The company has been collaborating with ElAZ Production Association PJSC (Tatarstan) since 2010; industrial assembly has startedsince 2014 in its sites.
Forbes estimates Mehmet Karamehmet's, the owner of Çukurova, at $1,15bn.
10. Low-cost airline and zone bearing the founder's name
Another rich family more in Russia is Sabanci Holding. It is controlled by Sevket Sabandci, Suzan Sabandci Dincer and Serra Sabandci. Their total worth is $3,05bn.
In Russia, it is represented by Pegasus Airlines, a charter airline that flew to Kazan too.
The representatives of Sabandci didn't come to Kazan, but Rustam Minnikhanov visited one of their projects. He was in Adani Haci Sabandci Organized Industrial Zone in spring of 2015. Bekir Sutcu, a representative of Adani Haci Sabandci Organized Industrial Zone, show a presentation of the petroleum refining plant for Rustam Minnikhanov. According to the representative, it was founded in 1984 and today is one of the largest special industrial zones of Turkey that occupies a territory of 1,590 ha. The industrial zone is located about 28 km from Adana Airport.
Nowadays on the territory of the Organized Industrial Zone there are over 350 companies of different industries of the economy: textile, food industry, petrochemical industry, papermaking, electrical equipment, metalworking, woodworking, construction materials, banking sector, paints and varnishes sector, etc.
Rustam Minnikhanov was interested in conditions offered to the resident companies and plans for further development of Adani Haci Sabandci Organized Industrial Zone.
11. Media magnate with finances
Doĝan Holding is one of the largest holdings in the media sector of Turkey. In Russia, its business is concentrated on Pronto-Moscow Publishing House that publishes Iz ruk v ruki (By hand; a classified advertising) newspaper, manages the online version of the irr.runewspaper and the job.rusite for searching a job. In Kazan Pronto Kazan PLC manages the project of the holding where there are the minorities of Kazan. The pearl in Adin Dogan's empire, the person whose worth is valued at $1bn, is a national newspaper of Turkey called Hurriyet (by the way, this newspaper periodically appears in the transmission of Realnoe Vremya on Russia-Turkey crisis). Tatarstan acquainted with representatives of Dogan holding in 2002 when the state delegation of Tatarstan headed by Rustam Minnikhanov, the Prime Minister of the Republic of Tatarstan arrived in Ankara. It was planned to meet with the owners of the Financial Group of Dogan Holding that controls the main mass media of Turkey'.
At the end of 2006 the delegation of Turkish Dogan Holding headed by Ahmet Caglar, the President of the Group of Industrial Companies, arrived in Kazan and visited KAMAZ PJSC and Nizhnekamskshina PJSC.
12. Stary Melnik drained Krasny Vostok
Diler Holding owns companies that deal with metalworking, transport and other sectors. The main asset of the company in Russia is Anadolu Efes that, in turn, owns Dutch Efes Breweries International N.V. The company has six breweries on the territory of Russia. At the same time, its factories are located in Turkey, Ukraine, Serbia, Georgia, Kazakhstan and Moldova besides Russia. In the Russian Federation, the factories of the company are in Kazan, Ufa, Ulyanovsk and Novosibirsk. The factories in Moscow and Rostov-on-Don closed in 2014. And the main brands of the company are Efes, Essa, Bavaria, Stary Melnik, Warsteiner, etc.
It should be noted that in 2006 Anadolu Efes Biracılık ve Malt Sanayii A.S purchased a controlling block of shares (92,34%) of Krasny Vostok – Solodov pivo from the Khairullin brothers, which had three breweries in Russia and produced 7,7 million hectoliters per year. The enterprises were sold for $364m. 'The price of Krasny Vostok – Solodov pivo was $400m, minus debt, that is to say, $364m in cash, and they paid off the bond debts of our companies,' Edelveys Group PJSC explained to Realnoe Vremya.
A new site of the Krasny Vostok – Solodov pivo complex of Turkish EFES Group opened in 2010. The volume of investments in modernization of malting complex, which began in 2006, was $28,5m. As a result of the realization of the projectб the total capacity of the malting plants of EFES in Russia increased by 35% to 175,000 tons of malt per year that allows the Turkish to provide all their breweries in Russia with raw material.
13. To breathe new life into woods of Tatarstan
Hayat Holding is a large holding founded in 1937in Turkeyby Yahya Kigili. The holding owns 24 brands and mainly specializes in wood processing, power engineering, construction and port operations. By the way, in Turkish Hayat means 'life'.
In Tatarstan it is represented by Kastamonu factory in the Alabuga Special Economic Zone. Kastamonu itself was founded in 1969 and has been producing particleboard in the city of Kastamonu since 1971. The company has 8 factories in Turkey.
In 2014 it launched a factory in Yelabuga; it also has factories in Bulgaria, Romania, Bosnia and Herzegovina.
In November, there were plans on opening the second line of the factory in Alabuga Special Economic Zone in February 2016. The investments in the second line will be equal to $200m.
Besides, one enterprise of Hayat Group more – Hayat Kimya–was launched in the Alabuga SEZ in March 2015. The investment in this enterprise made $150m; and it specializes in household chemicals and papermaking.
14. Will friends of the President of Turkmenistan save Shamov hospital in Kazan?
Polimeks Construction Co is reconstructing Shamov hospital in Kazan for Turkish chain of hotels Rixos. Realnoe Vremya wrote about it many times: after many years of 'conservation mode', the building was sold to Malaysian investors who were going to convert it into a health centre or hotel investing about $30m. Then the Asian company rejected the project and returned the building to the region. Tatarstan, in turn, found a new investor. Erol Tabanca, the chairman of the board of directors of Polimeks, visited Kazan during the presentation of the project.
Polimeks realized 131 projects apart from the reconstruction of Shamov hospital: international airport, ice palace, stadium, hippodrome and other buidlings in Ashgabat, Ritz-Carlton Hotel in Moscow, Kemer Country residence in Istanbul are among them. The company was founded in 1995 and became the largest developer in Turkmenistan.
15. Inappropriate hothouse conditions and polymer pipes
Dizayn Grup was created in 1987, and it specializes in heating and water supplying. Mir Holding is one of the main companies of the Group that produces water and heating pipes. At the end of November, it became known that Dizayn Grup was going to open a factory on the production of polyethylene and polypropylene pipes in Alabuga SEZ. In March İbrahim Mirmahmutoglu, the chairman of the board of directors of Mir Holding and the founder of the Group, declared that they would carry out the project on the territory of 1,200 ha. In September, the company postponed the project. According to Marat Akhmetov, it is connected with the inflated requirements of the Turkish investor. The sum of the planned investments was 2,3bn rubles.
