Petkim Sells Stake in Petlim Container Port to Goldman Sachs

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Researched by Industrial Info Resources (Sugar Land, Texas)--Petrochemicals producer Petkim (BIST:PETKM) (Izmir, Turkey), the Turkish subsidiary of Azerbaijan's State Oil Company of Azerbaijan Republic (SOCAR)(Baku, Azerbaijan), has sold a 30% stake in the Petlim Container Port in Turkey for $250 million to Goldman Sachs (NYSE:GS) (New York).

SOCAR Turkey Chairman Kenan Yavuz said the stake may be used to help the company float an initial public offering (IPO) in near future. "There's no timetable for [an] IPO, but we want to make it in foreseeable future," Yavuz said. "The agreement with Goldman Sachs will help to gain Petkim and Petlim's credibility in the investment community," he said. "With its 30% stake, Goldman will not be involved in the port operations," Yavuz added.

Petkim signed a preliminary agreement in July to sell its stake in Petlim to Goldman Sachs. For more information, see July 23, 2014, article - Goldman Sachs to Buy Stake in Petlim Container Port in Turkey.

SOCAR plans to finish its $5.5 billion investment in the Star Refinery in Turkey in 2018 to supply feedstock to Petkim and cut Turkey's dependence on imported refined products. "With Star Refinery in Aliaga-Izmir, we want to have one of the biggest integrated refinery plants in Europe," Yavuz said.

The Star Refinery will process 10 million tonnes of crude a year from 2017, producing 1.3 million tonnes of naphtha, 4.9 million tonnes of diesel and 1.63 million tonnes of jet fuel a year. It will also make liquefied petroleum gas and petro-coke.

When fully developed, the container port will have an annual capacity of 1.5 million 20-foot-equivalent units of containers. Petlim is responsible for the infrastructure of the port development project, while APM Terminals (The Hague, Netherlands) will operate the asset.

Separately, Goldman Sachs also signed a selling rights agreement with Socar Turkey Enerji A.S. (STEAS) for seven years. Goldman Sachs will pay $50 million to STEAS in advance. If this option agreement is executed, STEAS will take back Goldman's stake with an agreed minimum fee plus $300 million. Petkim will not have any obligations from this option agreement.

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