“Our new target is to grow in Europe”

Aygaz is one of the oldest companies in the Koç Group… It began operations in the LPG, that is to say the gas cylinder, business and later grew through product diversification. Recently it has become the group’s energy ‘flagship’. General Manager Mehmet Ali Neyzi says: “We have achieved a turnover of 1 billion Euro and become one of the five largest companies in Turkey. Our target for the future is to expand in Western Europe.”

There are very few companies in Turkey whose name has become a ‘generic brand’ in their sector. One of them is Aygaz. Aygaz was the Koç Group’s first and largest company in the energy sector and its brand name of ‘Aygaz’ has long been synonymous with ‘gas cylinder’. When, together with all the other major groups in Turkey, Koç Holding decided to grow in the energy field, it decided to do so through Aygaz.

Aygaz General Manager Mehmet Ali Neyzi summarizes their future targets as continuing to the leader in Turkey and offering customers new goods and services, while expanding their presence in LPG in Europe. We spoke with Mehmet Ali Neyzi about the LPG market, change in Aygaz and its plans for the future.

* In the past Aygaz was an LPG company and one which gave its name to bottle gas. There has been a change in recent yeas. Now it is seen as an energy company. What is this change and why did you feel the need for it?

Koç Holding decided to grow in the energy field. As Aygaz was its first and largest company in the energy group it was natural to decide to grow here.

LPG has a number of sub-categories. Autogas is an important growth area for Aygaz. Autogas is sold in filling stations. This was the premise behind our move towards systems integration through establishing our participation in Opet at the end of 2001. The Opet participation was our first expansion in which we were very happy with the results. Aygaz has a 40 percent stake in Opet. 10 percent is owned by other Koç companies. This means that Koç owns 50 percent of Opet. Opet grew considerably following this initiative. It increased its market share from 9 percent to 14 percent.

In addition to this, as natural gas was on the agenda, we formed a joint venture with the Norwegians called Koç-Statoil. This partnership was also realized through Aygaz. Most recently came the acquisition of Tüpraş. Aygaz owns 20 percent of the shares in Tüpraş. In short, Aygaz has become the energy flagship of Koç Holding.

* In recent years Aygaz has opened up to the outside world. You are planning to expand on the Western European market. What turnover are you targeting from these markets?

We established a company called Opet-Aygaz in Bulgaria. Half of the filling stations there belong to Opet-Aygaz. We shall continue to grow. Last year out turnover was 20 million Euro, we want to close this year with 45 million Euro.

Our interest in Western Europe is continuing. But because of the investment in Tüpraş Western Europe will come on the agenda after 2008. We have a capacity of 1.5 million tons and at the moment we rank fifth in the world. If we enter Western Europe we shall rise to third or fourth.

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