OYAK makes the first strategic investment of 2021. In the statement made to the Public Disclosure Platform (PDP), Ereğli Demir ve Çelik Fabrikaları T.A.Ş. (Erdemir), an OYAK Mining Metallurgy company, announced that a US$ 340 million agreement was signed with Yıldız Holding and Gözde Girişim for the acquisition of all shares of Kümaş Manyezit. According to the agreement, the transfer of shares will take place after legal approvals are obtained.
Attracting the attention of giant international companies, Kümaş alone accounts for nearly 20 percent of the world's cryptotoxic magnesite ore and ranks among the top 10 in the world. With this acquisition, OYAK will achieve cost control and efficiency by ensuring vertical integration in its activities in the iron, steel, and cement industries.
OYAK General Manager and Erdemir Board Chairman Süleyman Savaş Erdem said, “By acquiring this valuable company, which is important for our country and national resources, we have taken our country to a strategic position in this area with the rich reserves and raw material advantages, and by creating opportunities for our local industrialists in terms of raw materials supply and with the export potential.”
Making moves to contribute to the national economy and to make our country stronger on an international level, OYAK made the first strategic investment in 2021. Erdemir, an OYAK Mining Metallurgy company, signed an agreement for the acquisition of Kümaş Manyezit, the world’s largest mining operator in the qualified magnesite ore sector and the market leader in the refractory industry in Turkey. In the statement made to the PDP, it’s been stated that Erdemir will acquire Kümaş Manyezit for US$ 340 million and the share transfer will take place following legal approvals.
Erdem: “Both raw material supply and export potential”
Regarding the agreement for the acquisition of Kümaş Manyezit, OYAK General Manager and Erdemir Board Chairman Süleyman Savaş Erdem stated that they have achieved their goal of using Turkey's rich and valuable magnesite resources efficiently, achieving sustainable returns from these assets, contributing to the country's economy and using resources for international integration. For the acquisition, Erdem said: “By acquiring this valuable company, which is important for our country and national resources, we ensured an integration to our operations in iron, steel, and cement industries. With the advantage of rich reserves and raw materials, we created opportunities for our local industrialists in terms of raw material supply and took our country to a strategic position with export potential.”
Kümaş owns around 20 percent of the world’s reserves
Turkey is a country with rich areas of magnesite and dolomite mining regions and has strategic significance in this area. Kümaş Manyezit A.Ş. owns nearly 20 percent of the world’s high-quality magnesite ore and more than 40 percent of the total reserves in Turkey. Kümaş is the industry leader in refractory products, which are produced in integration with high-quality magnesite ore, and is a critical supplier for lime and glass industries, including iron and steel, cement, and copper with its domestic and overseas sales.
Kümaş produces in three facilities in Kütahya and meets the demand of all iron and steel producers in Turkey for a magnesite-based refractory and mortar. In 2020, Kümaş increased its sales by 14 percent year-on-year and exports to more than 50 countries with an annual processing capacity of approximately 1.2 million tons of ore.
A national success story
Founded in Kütahya in 1972, Kümaş is a national success story. Before its establishment, the magnesite mine n Kütahya was operated by an Austrian company. Foreign companies that purchased this metal for cheaper prices then sold it for higher prices to companies in Turkey in glass and cement industries, including iron and steel, as intermediate products. Kümaş was established in 1972 by the government and the public to put an end to this situation. Turkey's minerals are enriched with national and domestic Kümaş, and the exports started in a short time. Listed among the biggest exporters in Turkey in the 1980s, Kümaş was sold to Zeytinoğlu Holding in 1995 as part of its privatization. Kümaş, which was transferred to the Savings Deposit Insurance Fund (TMSF) in 2009, joined the Yıldız Holding in 2012. Kümaş is recognized as one of the world’s leading companies and pursued by foreign companies. In fact, Kümaş, which was about to be sold to a European company last year, will remain a national and domestic company with the latest move of the OYAK Group.