Dogus Group: Our Property in Croatia Isn’t For Sale

Lauren Simmonds

Updated on:

As Gordana Grgas/Novac writes on the 30th of August, 2019, Turkish billionaire Ferit Sahenk, the owner of the huge Dogus holding which owns several marinas and luxury hotels in Croatia (Dogus Group Croatia), announced this week that he is ready to sell assets worth up to 800 million euros as part of a debt restructuring plan, as was reported by Bloomberg.

The Dogus Group Croatia company, as they confirmed, are not included in these sales plans.

The sale of hotels, restaurants, offices and shares of the Turkish giant, conducted this year and last year (mostly outside of Turkey), has reached about 625 million euros, according to Moody’s back in May. Then the aforementioned agency lowered Dogus’ corporate credit rating to Caa1 from B3, with a stable outlook. Earlier this year, Sahenk entered into a syndicated loan deal with twelve banks in Turkey to settle short-term liabilities, and as a result, it’s expected that the group will continue to sell assets to reduce debt and improve liquidity.

In this week’s interview, Sahenk announced that the Dogus group would lower its debt of 2.3 billion euros by the end of 2019, down to 2 billion euros, and by the end of 2020 to 1.5 billion euros, thanks to the sale of assets.

Founded back in 1951, Dogus is headquartered in Istanbul, and is an investment holding company owned by the Sahenk family, comprising more than 300 companies across a wide range of sectors, from automotive, construction and real estate, to media, tourism, hospitality and, finally, energy. Dogus has invested almost 9 billion euros in various sectors in the last ten years, with 83 percent of it related to Turkey, Sahenk said in an interview.

According to data from last year, the group employed about 35,000 people, of which about 5,000 were in the Dogus Tourism group.

The Dogus Group is usually represented in Croatia as one of the largest foreign investors in tourism, and they say that in the ten years they have been operating here, they have invested 270 million euros and employed about 350 local workers.

They did not respond to Novac’s inquiry about their business results, saying that they are dedicated to operating the business of all their companies and further optimising their results, “and all of our operating Croatian companies are reporting another successful season and business year,” they made sure to note.

The Turks made their first Adriatic acquisition with the D-Marin Mandalina in Šibenik, after which they took over D-Marin Dalmatia in Sukošan, one of the largest in Croatia, and then D-Marin Borik in Zadar, and at the eve of this season, the group announced the completion of a 2.5 million euro investment. They have also announced that they will start a new investment cycle in Marina Dalmacija this autumn, with a total value of 5 million euros.

The D-Marin Mandalina also includes D-Resort Šibenik, the first greenfield investment of the Dogus Group in Croatia, worth a massive 26 million euros, with a hotel and luxury villas. The Dogus Group also owns the prestigious boutique hotel Villa Dubrovnik.

As a new major project of the Dogus Group in Croatia, the old facility of the Maraska Beverage Factory in Zadar, has long been announced as an exclusive 130-room hotel – the Hyatt Regency Maraska Hotel, along with the luxury residential part, but the realisation has been stalled. It is an investment of around 100 million euros.

In response to Novac’s question, they say that the Zadar project is ready, but is still awaiting the outcome of an open tender.

”Every investor, and in this case the Hyatt brand, seeks security and a clear vision for the development of the environment of the location in which they make their investment. As it’s an extremely large investment, it isn’t unusual for an investor to want to know what’s happening in the immediate neighbourhood of his project, to make the best decision on the further development of that project,” the stated.

They added that Dogus is one of the bidders in the tender and has a vision of developing the entire micro-location. “As a bidder, we’re awaiting the outcome of the tender, believing that it will be completed in a transparent manner after five years,” they said. They didn’t comment on whether the start-up of this project was related to the financial restructuring of the Dogus Group.

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