Announcement of Thirty-Five Million Eighty Thousand US Dollars Project in Turkey Expands Engine Parts Manufacturing on December 8, 1978

I nternationa1 Finance Corporation • 18i8 H Street, N.W. Washington, D.C. 20433, U.S.A. 202-477-1234 ~ ., tr ~ < sr r ~ 1 " • - , , <..,/' "'" "....., ' • 1 ' ,,_ l ... • , .. ~ IFC Press Release No. 79/20 Friday, December 8, 1978 $35.8 Million Project in Turkey Expands Engine Parts Manufacturing Turkey's· automotive components industry is being expanded with the estab- lishment of Istanbul Segman Sanayi A.S., a $34.8 million venture to manufacture piston rings and cylinder liners for domestic use. The Company will build a plant near Adapazari, a developing area about 85 miles east of Istanbul, with an annual capacity of 12 million piston rings of approximately 300 types and sizes, and 800,000 cylinder liners of 30 types and • sizes. The components will help meet increasing demand from the growing Turkish DK>tor vehicle and tractor industry and result in estimated net foreign exchange savings of $13 million a year. Financing is being provided by Turkish and foreign investors and by the International Finance Corporation (IFC), an affiliate of the World Bank. The primary sponsor is Ercan Holding A.S., an Istanbul industrial group with opera- tions principally in the automotive field. Equity is being provided by Ercan Holding companies, Istanbul Mahle Piston and Tercan Yatirim Holding, $5.5 million; Turkiye Is Bankasi, $2.1 million; Turkiye Sinai Kalkinma Bankasi A.S. (TSKB) and IFC, $1.4 million each; and private Turkish investors, $3.3 million (including $2.8 million by public offering). IFC is lending $8 million for the project; TSKB is providing a $5 million foreign currency loan and the Arab-Turk Bank, $2 million. Suppliers' credits and loc&.!. bank loans complete the financial plan. Istanbul Segman will produce the piston rings and cylinder liners under license from, and with the technical assistance of, Nippon Piston Ring Company of Japan. Nippon Piston Ring is one of the world's largest manufacturers of • these components • The project introduces new technology to Turkey. domestic production of piston rings up to now, all requirements being met by There has been no  - 2 - imports. The Company's production will complement the activities of the sponsors who are already established in truck assembly and in the manufacture • and marketing of other automotive co~onents. The project supports development of Turkey's engine industry, which is being encouraged by the Government, and will provide domestically manufactured parts for assemblers of automobiles, buses, trucks and tractors as well as for the replacement market. At full capacity, Istanbul Segman will employ more than 600 workers. • (Any inquiries strictly relating to IFC's participation in this project should be directed to the IFC Information Office, 1818 H Street, N.W., Washington, ~ D.C. 20433, Telephone (202) 477-5340.)