Abu Dhabi fund ADQ to acquire 96% of Bank Audi’s Turkish unit

ADQ, the smallest of Abu Dhabi’s three sovereign wealth funds, said on Tuesday that it will acquire 96 per cent in Turkish lender Odeabank, owned by Lebanon’s Bank Audi, as entities based in the GCC seek to expand their growth opportunities abroad.

Under the deal, Bank Audi and other investors, including the International Finance Corporation, IFC FIG Investment Company Sàrl, and the European Bank for Reconstruction and Development, will sell their stakes in Odeabank to ADQ.

ADQ said the deal is subject to customary regulatory approvals, including the approvals of the Banking Regulation and Supervision Authority and the Competition Authority in Türkiye.

“The acquisition of Odeabank reinforces our commitment to investing in assets that lay the foundation for the sustainable development of our portfolio companies as well as the wider economy,” said Mansour AlMulla, deputy group CEO at ADQ.

“Odeabank will have access to fresh capital, which will allow the bank to unlock synergies with our wider portfolio, underpinned by attractive market dynamics in Türkiye.”

Odeabank is a midsize lender in Turkiye with assets of $2.6bn (TRL87.3bn). Bank Audi, which established the bank in 2012, is its largest shareholder with a 76.4 per cent stake.

The lender is Türkiye’s 13^th largest private conventional bank by total gross loans and customer deposits, with 41 branches in 15 cities across the country and it employs around 1,300 people as at the end of June 2024.

Banks in the GCC region are exhibiting a strong appetite to grow their presence in major regional markets, particularly Turkiye, Egypt, and India, Fitch Ratings said in July while citing improved economic conditions and growth opportunities in target markets.

GCC banks’ main exposure outside the region is through subsidiaries in Turkiye and Egypt, which held around $150bn in assets in the first quarter of 2024.

Meanwhile, UAE’s First Abu Dhabi Bank (FAB) was linked with a possible acquisition of Turkish conglomerate Koc Group’s 61.2 per cent stake in Istanbul-based lender Yapi Ve Kredi Bankasi (Yapi Kredi) in May.

However, a deal between FAB and Yapi Kredi was hampered by disagreements over price.

Dubai Islamic Bank, the UAE’s biggest Shariah-compliant lender by assets, acquired a 20 per cent stake in Turkey’s TOM Group of Companies in September 2023.

Similarly, Dubai’s largest bank, Emirates NBD, acquired 99.85 per cent of Denizbank’s shares for $2.76bn in 2019.

Read: Abu Dhabi’s ADQ reportedly plans to acquire Bank Audi’s Turkish unit