Gulf capital head-to-head with co-ops in sugar refineries bid

Offers for the refineries, which are being sold as part of a larger plan to privatize 25 TÜRKŞEKER refineries, were being accepted through last night. TÜRKŞEKER’s total production for 2010 is expected to be 10.4 million tons of sugar; however, only 61 percent of the refineries’ capacity is expected to be utilized.

The Turkish Agriculture Credit Cooperative Central Union (TTKKMB) will make a joint offer with Saudi Arabian-based Savola Group and Nesma Holding, also a Saudi company. The partnership, if the offer is accepted, would give the TTKKMB and Savola Group 40 percent ownership of the refineries apiece, with Nesma Holding receiving 20 percent. The Savola Group currently holds a 68 percent market share in the Saudi sugar industry, while Nesma Holding has a diverse portfolio, including business activities in advertising and logistics.

The bid has drawn criticism from many groups, especially from the individual refineries themselves, which have raised concerns about foreigners buying Turkey’s sugar refineries. Ali Özışık, chairman of the Kayseri Sugar Refineries, which are also being privatized in a separate lot, claimed that “[these foreign companies] would not be able to meet the needs of our farmers.” To make a counteroffer for the lot, the S.S. Beet Farms Cooperative Union (PANKOBİRLİK) joined forces with other sugar refineries and farming cooperatives in the Central Anatolian region to form the Northern Anatolia Sugar Refineries Joint Venture. They hope to buy the refineries on offer with their own capital.