(Bloomberg) -- Azerbaijan’s state energy company Socar is in discussions to sell its natural gas distribution business in Turkey.
“We have recently begun talks for the sale of Socar Turkey Dogalgaz Yatirim AS,” owner of local gas-grid operators Bursagaz and Kayserigaz, a spokesperson for Socar told Bloomberg. They declined to provide further details, citing ongoing legal processes.
A potential sale of the units — which carry gas to homes and businesses — could fetch a total value of several hundred million dollars, according to people familiar with the matter. However, no decision has been made, and there is no certainty that a transaction will take place.
Several potential buyers — Aksa Dogal Gaz Dagitim AS, Ahlatci Dogal Gaz AS and Palmet Enerji AS — are in direct talks with Socar’s Turkish company, the people said, asking not to be identified as the information is private.
Aksa, Ahlatci and Palmet declined to comment.
The two distribution companies last year sold a total of 1.7 billion cubic meters of gas to 1.3 million consumers in Bursa and Kayseri provinces, according to official data. Bursa is Turkey’s fourth-biggest demand center after Istanbul, Ankara and Izmir.
Socar acquired both firms in 2019 when it bought German energy company EWE AG’s Turkish assets for an undisclosed sum.
Owned by Turkey’s key political ally Azerbaijan, Socar is the top foreign investor in Turkey with $18 billion spent to date, according to the company’s website. Besides the distribution companies, it also owns the STAR refinery on the Aegean coast, with refining and petrochemicals lying at the center of its Turkish business.
Socar also exports gas from Azerbaijan to Europe via Turkey through two pipelines.
©2024 Bloomberg L.P.