Publication Date:January 22, 2018
Industry:Food & Beverage
Source:Harvard Business School
In 2015, Yıldiz Holding, one of the world's largest producer of confections, biscuits and crackers, was at the end of its divesture process from Ak Gida, one of the leading dairy companies in Turkey.
The downside of dual-track deals
The company had adopted a dual track process, pursuing an initial public offering (IPO) process as well as attempting, in parallel, a strategic sale to create a competitive bidding process. Ak Gida was co-founded in 1996 by the Ulker and Topbas families as a result of a joint vertical integration strategy: Ulker family, owners of Yildiz Holding, would secure milk powder, one of the main raw materials for its biscuits and chocolate production, and Topbas family would be able to create its own private label dairy products for its nation-wide hard-discount chain BIM.
Following Yildiz Holding's acquisition of United Biscuits for over $3 billion in 2014, the Holding's CFO Cem Karakas and its Chief Strategy and Growth Officer Nurtaç Ziyal Afridi, were tasked with divesting of its vertical assets including Ak Gida. The duo had prepared Ak Gida for an IPO in Istanbul, while also having negotiated with multiple parties for its sale.
Now, the duo needed to make a final decision: should they go forward with the listing, or should they sell Ak Gida to the world's largest dairy company, Groupe Lactalis?
Product #: 118036
Related Topics:Strategy, Business models, IPO, Valuation, Mergers & acquisitions, Decision making, Exit decisions, Growth strategy, Value creation, Family businesses, Conglomerates, Shutdowns, Joint ventures, Competitive advantage,