Posted by meb at March 29th, 2008

Despite all obstacles faced since the outset of petrochemicals giant Petkim’s privatization, the fate of the company will be sealed soon. The handover of Petkim’s 51 percent public shares to Socar-Turcas-Injaz Joint Venture Group is expected occur by May 7.

Following the handover, Petkim will begin to play a very positive role in Turkish economy, said Erdal Aksoy, chairman of Turcas Petroleum, the Turkish partner of Royal Dutch Shell Plc. Petkim will also have a very important function for Turkish industry’s export to the world, Aksoy added.

Regarding how to handle the payment, a comparison concerning price and other factors is being made at present, said Aksoy, adding that the final decision on the issue will be announced by April 14.

There is no concern regarding the process of the lawsuits against the handover of Petkim’s public shares, he said. The privatization administration, the addressee for these lawsuits, is making progress on the issue, he added.

Not concerned:

The projections concerning Petkim will be shared with workers, syndicates and non-governmental organizations, he said, adding, “However, we do not feel authorized to talk about this at present. We will do it after the handover. Petkim will be Turkey’s petrochemicals base.”  In his previous statements Aksoy said that an investment capacity program worth $10 billion is on the agenda within seven to eight years. There are plans to establish two electric power plants based on natural gas and coal with EON, the world’s largest investor-owned energy service provider, he said. He also noted formerly that Petkim will have a market share of 40 percent in emerging Turkey.

Tender process:

The privatization tender for Petkim’s 51 percent public shares took place via a block sale in July 2007. TransCentralAsia Petrochemical Holding Joint Venture Group offered the highest bid of $2.05 billion at the tender. However, the tender committee approved the second highest bid of $2.04 billion from Socar-Turcas-Injaz Joint Venture Group.   The State Council Chamber, Wednesday, rejected a third appeal of the Nov. 22, 2007 Supreme Privatization Board (ÖYK) decision to sell Petkim to the Socar-Turcas-Injaz Joint Venture Group. The claimant, the Union of Petroleum, Chemicals and Rubber Workers (Petrol-İş), has the right to object to the State Council decision.

Company background

Petkim was established April 3, 1965 under the leadership of the Turkish Petroleum Corporation (TPAO). The company initially started up five factories in İzmit- Yarımca Petrochemical Complex in 1970. Other factories followed in time. Due to the rapidly growing demand, Petkim established a second complex. Aliağa Complex, which was established with highly advanced Technologies and optimum capacities of those days, started operating progressively starting from the year 1985. Petkim, among Turkey’s most popular companies with its 14 factories, eight joint facilities, electricity generation unit, waste unit as well as its port and dam, is prominent raw material supplier for Turkish industry with its petrochemical product range covering over 50 products. Among the raw materials Petkim produces, plastics and synthetic rubber are among the important inputs of construction, agriculture, automotive, electricity and packaging sectors. Synthetic fiber, on the other hand, is used in textile sector. Moreover, Petkim produces several inputs for many industries such as pharmaceuticals, paint, detergent and cosmetics.

Source: Turkish Daily News