Erdemoğlu Holding, which includes brands such as Sasa Polyester, Merinos, and Dinarsu, is one of the most important groups in Turkey with a turnover of approximately 100 billion TL. The foundations of Erdemoğlu Holding were laid when İbrahim Erdemoğlu started to keep on with his father's profession of carpet trading during his university years. Erdemoğlu, who founded Merinos Halı in 1998 and then bought Dinarsu and SASA Polyester, one of the world's leading manufacturers of polyester fiber, filament, and polyester-based polymers, today ranks at the top of the list of "Turkey's richest people."
Erdemoğlu Holding, which has recently attracted attention with its colossal investments in the carpet and polyester sector, is preparing to reap the fruits of its investments in 2025. The company, which plans to close 2024 with a turnover of approximately 100 billion TL, aims to grow by 50 percent with the contribution of new investments to be put into practice in group companies in 2025. Expressing that they are also planning to open Merinos, one of the most important brands of the group, to the public, Erdemoğlu Holding Chairman İbrahim Erdemoğlu says, "We will increase our profitability in the markets we dominate by creating a cost advantage with the impact of our capital structure strengthened through the public offering."
YOU HAVE RECENTLY BEEN STANDING OUT WITH YOUR INVESTMENTS IN THE POLYESTER AND CARPET SECTORS. WHAT ARE YOUR TARGETS IN BOTH SECTORS?
The polyester industry is a sector that constantly provides input to large players in the production sector around the world. We can say that the sector has a high export potential. As a group, we are a leader in the polyester sector in the region outside China and India. Extended transportation times from the Far East to Turkey and Europe, increasing freight costs, and fluctuations in energy costs have increased the demand for our country from the producers in the nearby geography. Gaziantep and Turkey play an important role in the area rug sector. Our group is the world leader in the area rug sector. In parallel with the decrease in global economic uncertainties and the increase in demand, particularly in the nearby market, our group focuses on ongoing capacity and modernization investments in the carpet and polyester sectors. Most of these investments, worth approximately 2,3 billion dollars, are planned to be completed by the end of 2024. In particular, projects such as the PTA (Pure Terephthalic Acid) Production Facility, Textile Chips and Pet Chips Production Facility, Fiber Production Facility, and Rooftop Solar Power Plant (SPP) will contribute to increasing our exports by providing cost advantages.
WITH HOW MUCH TURNOVER DID YOU CLOSE THE YEAR 2024? WHAT IS THE GROWTH TARGET FOR 2025?
We predict to close 2024 with a turnover of approximately 100 billion TL. We expect a 50 percent growth rate in 2025 with the contribution of new investments to be made in group companies. In fact, we can say that 2025 is the year when our activities will be put into practice. With what we have done so far and what we will continue to do, we will have completed an investment of 4 billion dollars.
"WE WILL TAKE MERINOS PUBLIC"
"We are planning to open Merinos Carpet to the public next year. Presumably, it will take place in the fifth month of 2025. With the impact of our capital structure strengthened with the public offering, we will increase our profitability in the markets we dominate by creating a cost advantage. We will make use of the resources from the public offering in working capital financing."
WHAT IS THE LATEST SITUATION IN THE YUMURTALIK INVESTMENT, ONE OF THE GROUP'S BIGGEST PROJECTS?
Yumurtalık Petrochemical Facility Project will be one of the largest petrochemical facilities in Turkey. It is planned that it will be developed as a petrochemical production facility where semi-processed raw materials used in polyester polymer production as well as some high value-added products will be produced. The investment budget of Yumurtalık is anticipated as 5,5 billion dollars for the first phase. The production to be carried out in the facilities that will be established in the project site, which is planned to reach a total of 11 million square meters, will have 100 percent import substitution. The project, which is expected to be completed in approximately 12 years with an investment amount of 20 billion dollars, is planned to start in 2025 following the completion of the ongoing investments and the its start of providing cash flow. We have not started to negotiate with anyone about the business partnership because the process is not fully finished in terms of the location in the Yumurtalık project. But we will not take a partner to SASA. The companies we will establish there will be partners.
WHAT PERCENT OF THE GROUP'S TURNOVER COMES FROM SASA TODAY?
60 percent of the group's turnover comes from SASA. We expect exports, which are currently 25 percent, to increase starting from 2025, when investments will take place, and approach 50 percent in the long term.
WHAT KIND OF MOMENTUM WILL THE PTA INVESTMENT, PLANNED TO BE COMPLETED AT THE END OF THE YEAR, PROVIDE TO THE GROUP?
We plan to commission the PTA investment, which is under construction on an area of 375 thousand square meters, in December 2024. As of 2025, it will provide our company with a competitive advantage with a decrease in raw material and conversion costs. PTA is planning to produce 1,5 million tons per year in 2025 and 1,7 million tons per year in the subsequent years.
YOU ARE ONE OF THE WORLD'S IMPORTANT PLAYERS IN CARPET. WHAT KIND OF GROWTH STRATEGY WILL YOU FOLLOW IN THIS FIELD?
We aim to maintain our position in the competition in the carpet sector, with product diversification and our modernized machinery. In addition, we plan to increase our market share with the investments we make in the wall-to-wall carpet (tufting) sector. At Merinos Carpet, we have an annual production capacity of 50 million square meters in area rugs and 80 million square meters in tufting carpets. The investment of the facility of MTR, one of the raw materials of carpet, is ongoing. The project, which has an investment budget of approximately 215 million dollars, is planned to be put into operation in July 2025. Merinos Carpet will use 25 percent of the production for its own consumption and sell the remaining part to companies in the nearby geography. We export to more than 50 countries, especially the US and EU countries. Demand continues to come from all around the world, particularly for area rugs. In area rugs, one in every four carpets sold in America and one in every three carpets sold in Europe is Merinos.
CAN YOU MENTION THE GROUP'S SUSTAINABILITY STRATEGY?
As Erdemoğlu Holding, we have accelerated our efforts for the global climate movement. One of the most important examples regarding this subject is our PTA facility. When it first operates in PTA, we will provide electricity and then it will generate its own electricity. It will not use electricity again. It is a technology realized with gases flying into the air. The EBRD has not granted loans to any petrochemical company because they are not environmentally friendly. It gave a loan to SASA for the first time because it is environmentally friendly. We received a loan of 75 million Euros from the EBRD for the PTA production facility because of both energy and waste. We reuse 65 percent of the waste in the business. We use 34 percent of it in recycling. And we will use 1 percent outside. We have established our treatment plant there in a structure that has few examples in the world. Our sustainable business model, which has science-based targets, will not remain limited to the roadmaps planned for climate change. In this direction, our projects will continue in line with the United Nations Sustainable Development Goals in environmental, social, and governance elements at the center of our sustainability strategy.
Source of News: Ekonomist
