Abraaj Buys Fibabanka Stake, Plans More Deals in Turkey

Emerging markets focused private equity firm Abraaj Group said on Monday it had acquired a minority stake in Fibabanka to get a foothold in the Turkish banking sector and it may do two or three more deals in Turkey this year. Private equity transactions have dropped off in Turkey due to political uncertainty, security concerns and a struggling currency, which make it harder to lure new investors and to exit investments profitably. However, Abraaj’s move to buy a 9.95 percent stake in Fibabanka comes days after British private equity firm Bridgepoint bought Turkish dried fruit and nuts producer Peyman in a deal sources said was worth some $110 million. Fibabanka will use the investment by Abraaj, which has about $9 billion in assets under management, to expand its franchise and support its growth, Abraaj said in a statement. “The Turkish banking sector loan book has increased tenfold in the last decade, yet Turkey remains an under-leveraged market with a household debt to GDP ratio that is approximately a third of the Eurozone average.”