Abraaj milks relationships in Turkey

A strong rapport with the family owners of $300m Turkish dairy Yörsan helped the emerging markets investor’s bid.

The Abraaj Group, a global growth markets investor, has acquired Yörsan Group after a five-year search for a leading Turkish dairy producer.

Financial details were not disclosed for the deal, which leaves Abraaj the majority shareholder alongside the European bank for Reconstruction and Development (EBRD) and the founding Yörük family.

Selçuk Yorgancioglu, Abraaj’s lead partner on the deal, said the transaction took more than a-year-and-a-half to come to fruition as the Yörük family had not been looking to sell.

“We had to approach three different members of the Yörük family in three different locations in Turkey, requiring a great deal of contact skill and negotiation to show them we had the best of intentions,” said Yorgancioglu. “When other groups heard about our aims, there were other bids, but they did not have same quality of contact with Yörsan, and ours was successful.”

Abraaj will employ a new management team to work with second-generation Yörük family members, implementing an immediate 100-day plan to identify operational areas of change and a five-year ‘value creation’ target to bring Turkish dairy consumption up to the EU average rate. Turkey currently consumes one-third of the European average for a country of 80 million people, according to Abraaj.

Yörsan is Abraaj’s eighth deal in Turkey since 2007, according to a statement. The firm declined to specify which of its fund(s) has agreed to make the investment; Yorgancioglu said it was one of the firm’s regional investment funds, a number of which list Turkey among their geographic focus including Abraaj’s latest flagship MENASA private equity fund, as well as the Riyada Enterprises Development Growth Capital Fund and the G43 Anatolian Venture Capital Fund 2, a £20 million fund targeting the emerging regions of Turkey and backed by the European Investment Fund, Small and Medium Industry Development Organisation of Turkey and Istanbul Venture Capital Initiative.