Abraaj takes on minority stake in Turkey’s largest logistics company

Abraaj investment will help Netlog further consolidate its domestic market share and international expansion

Abraaj has taken on minority stake in Turkey’s largest logistics company, Netlog Lojistik Hizmetleri

Dubai-based Abraaj Group, a private equity firm that invests in emerging markets and manages about $10 billion in assets, acquired a “significant minority stake” in Netlog Lojistik Hizmetleri, Turkey’s largest integrated logistics company with a strong presence in Europe and Asia.

The investment in Netlog is Abraaj’s tenth in Turkey, and indicative of the company’s “conviction about the attractive long-term fundamentals of the Turkish economy,” said Selçuk Yorgancıoğlu, Partner and Regional Head of Turkey and Central Asia at Abraaj Group.

“The transaction also corresponds with our strategy of partnering with businesses operating in structurally sound sectors that have demonstrated robust growth and are primed to achieve further success. Turkey’s geostrategic location creates a huge number of opportunities for the country’s most dynamic businesses to grow beyond their borders.”

Growth is projected to pick up this year in emerging and developing Europe according to the International Monetary Fund driven by a higher growth forecast for Turkey, which has seen a rebound in its exports after four quarters of moderate contraction. Turkey’s economy grew 5 per cent in the first quarter of 2017 on higher government spending and the economy is set to expand this year 2.5 per cent and accelerate 3.3 per cent in 2018, according to the IMF.

“The logistics sector will continue to play a key role in the long-term strategic development of Turkey, bolstered by the government’s plans to further upgrade its logistics infrastructure by 2023, with a focus on high speed rail, motorways and container port facilities,” Abraaj said in a statement. “As the most diversified logistics company in Turkey, Netlog is competitively placed to benefit from these growth drivers.”

Netlog, founded in 2003, operates one of the largest owned fleet in Turkey with over 3,200 transport vehicles and is the largest and most diversified logistics company in the country. Abraaj, which started investing in Turkey a decade ago, did not disclose the size or value of the stake in Netlog. Abraaj has invested in Hepsiburada, Turkey’s largest e-commerce platform in 2015 and Fibabanka last year.

Abraaj started investing in logistics in 2002 with its acquisition of Aramex in the Middle East, which subsequently listed on the Dubai Financial Market. The private equity firm has also invested in logistics operators in South East Asia, Sub-Saharan Africa and Latin America.

“Having grown Netlog to become one of Turkey’s top 100 companies, we are excited to embark on this new journey with Abraaj,” said Netlog Chairman Şahap Çak. “They recognise the value the Netlog leadership and senior management team have brought to the business and are fully aligned with our growth plans.”