Turkish arm of Abraaj looking for a clean break
In another hit to Abraaj, its Turkish branch is looking to sever ties with the tainted private equity firm, once the Middle East’s largest buyout fund with close to $14bn of assets under management.
The Turkish branch of Abraaj is on the lookout for a new owner who is expected to facilitate the sale of the assets in the current portfolio and then commence new fundraising, according to people privy of the affairs, the FT reports.
A Canadian asset management group, Brookfield is said to be in negotiations with the Turkish entity of Abraaj to acquire it, according to people aware of the talks.
Once the sale is finalised, it is expected Selcuk Yorgancioglu, co-chief executive of the Abraaj group in Turkey who, along with group partner Omar Syed is expected to lead the business.
Yorgancioglu said: “This [Turkey] is still the best platform in emerging markets. Most of the companies in the Abraaj portfolio in Turkey are in good shape. After the sale to a new owner, people are hoping the business can be rebuilt. This is an opportunity.”
However, industry insiders aren’t satisfied that the Turkish entity will have smooth sailing once it separates from Dubai-based Abraaj.
According to the FT report, divesting assets in the turbulent environment will be difficult considering businesses have experienced write-downs of 20% or more.
The Turkish branch of Abraaj after acquisition by Brookfield expects to begin raising $1 billion from investors, however, considering but funds raiser is contingent on the divestment of the businesses that it presently owns is successful, people aware of the plans told.
At its height, Abraaj managed over $14bn in emerging market investments and was the largest private equity firm in the MENAF region.
Now, its fund unit reportedly received a $1 bid from Actis.