Syntaxis takes first bite out of Turkey

Central Eastern European mezz lender Syntaxis Capital has completed its first investment in Turkey, according to a statement.

The firm has provided a €13.5 million mezzanine loan to Ugurlu Cam, a specialised glass products manufacturer. The loan will provide recapitalisation and growth financing to fund organic growth and part-fund prospective acquisitions.

Thomas Spring, partner at Syntaxis, told PDI, that he believes there is an opportunity to provide long term financing to companies in Turkey, driven to some extent by a reduction in activity by Western European banks in the region.

Selim Iskenderogiu, responsible for Syntaxis local operations in Turkey, explained that the country’s domestic bank approach to financing was from an asset-based lending mindset and thus with higher security expectations, making the market more attractive for alternative financiers.

Syntaxis entered the Turkish market two to three years ago. Its debut deal took around a year to finalise from source to completion.

“We are proud of having completed the first of hopefully many investments in Turkey,” Spring said in a statement. “The company combines all of the elements we look for in investment opportunities, and provides an example of the kind of situations where our type of financing can provide a substantial difference to the business,” he added.

Privately owned Ugurlu Cam was founded in 1971 in Denizli, Turkey, and has grown to become one of the largest manufactures of car glass for the replacement market in Turkey. Iskenderogiu commented: “Ugurlu Cam competes in a very attractive market, underpinned by sound, double-digit growth prospects, and the flexibility of their production and the breadth of their product portfolio provides them with a clear competitive advantage over other suppliers.”

Syntaxis was advised by Macfarlanes in London and Ernst and Young and While & Case in Turkey. Ugurlu was advised by Devrim & Cukur and Ark Consulting.

Syntaxis’s primary market in CEE remains Poland, Spring said. The firm manages two funds with aggregated commitments of just under €250 million.