Enerjisa, owned by Turkey's Sabanci and German E.ON, will be ready for its initial public offering (IPO) at the beginning of 2018, however, shareholders will have the final say on the timing of the offering, the company's CEO said in Barcelona.
Enerjisa CEO Kivanc Zaimler, speaking to Anadolu Agency in Barcelona where he received a Customer Services Reward at the weekend, explained that the shareholders, who will determine the exact timing of the IPO, want to manage the company in a more effective way.
Zaimler clarified that part of the company's strategy was to split it into two companies, which occurred during the summer. The company was divided into Enerjisa and Enerjisa Uretim (Production) AS with the former focusing on electricity distribution and retail, and the latter on generation.
'We can say that the distribution and retail side will be ready for an IPO at the beginning of 2018. The duty of the company's management is to make the company ready for the processes but the timing of the IPO will be determined by the shareholders,' Zaimler announced.
He also cited that IPOs would not only reveal the real value of a company but also act as a reference point in the sector.
Turkey's Haci Omer Sabanci Holding and German E.ON each own a 50 percent share in Enerjisa.
- Turkey's electricity demand to grow further
Zaimler predicts that Turkey's electricity consumption will rise with the country's ongoing urban transformation.
Turkey's domestic electricity consumption is smaller than in European countries and is equivalent to almost a quarter of the U.S.' consumption, he said.
'However, immigration is a factor increasing electricity consumption along with urban transformation [in Turkey] that is being carried out in numerous parts of the country, and due to this urban transformation, electricity demand is almost tripling,' he said.
Urban transformation refers to the construction of new buildings with state support, including tax advantages, to replace old demolished buildings determined unfit for habitation by the Ministry of the Environment.
This process sees a rise in electricity consumption as generally the replacement higher buildings, which house greater numbers, use more power.
Zaimler said Enerjisa would invest 5 billion Turkish liras between 2016 and 2020 for electricity distribution to meet demand and to modernize the existing infrastructure.
Since the beginning of 2017, Enerjisa has issued 1.2 billion Turkish liras in bonds on five separate occasions, Zaimler said, adding that the company was the first to issue bonds for investments in the sector.
Enerjisa is a leading electricity distributor company in the country that services 14 cities and has around 9 million customers.
By Nuran Erkul Kaya in Barcelona