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Buy-side advisory to LukOil in its acquisition of Aytemiz, a leading retail fuel network & storage business

Russian oil giant Lukoil acquires Akpet for $550 million

 Akpet, whose 693 petrol stations account for some 5 percent of the Turkish market, facilities include eight oil terminals with a total capacity of 300,000 cubic meters, five LPG depots, three jet fuel depots and a lubricants production and packaging plant in Izmir’s Aliaga with a capacity of 12,000 tons per year. Six of its eight oil terminals are on the coast and can accommodate oil tankers, and three terminals are connected by pipeline to TÜPRAS, the former state-owned refinery bought by Koç Holding in 2005. Of licensed fuel distributors in Turkey, Akpet ranks sixth in terms of market share, third in terms of storage capacity and second in terms of number of depots.

Lukoil is the second largest oil company in the world, after ExxonMobil, earning over $11 billion in profit on greater than $90 billion in sales. Lukoil is a vertically integrated oil company based in Moscow, with production concentrated in western Siberia. The firm accounts for 1.3 percent of world oil reserves, about 2.1 percent of world production, and 18 percent of production and refining in Russia. Lukoil is a privately controlled company traded on the London and Moscow stock exchanges. Its market capitalization now stands at $92.5 billion. Lukoil Eurasia handles bunkering, wholesale and retail sales of petroleum and petrochemical products and also produces and sells packaged lubricants under the Lukoil brand.

Lukoil will supply its new Turkish retail network from its refinery in Bulgaria, and another operated in Sicily as a joint venture with Italian oil company ERG. The Bourgas refinery will supply petrol and aviation fuel, while the ISAB refinery complex in Priolo, Sicily, will mainly supply kerosene and diesel fuel. Buying Akpet expands Lukoil’s foreign retail network by 18 percent. This acquisition represents a key element in Lukoil’s strategy to develop its downstream business on the Black and Mediterranean Sea markets, especially in terms of delivering high value-added products to end users.