We are looking for new acquisitions

Over the last 10 years, Nihat Özdemir has grown Limak at astonishing speed. Özdemir says that the success they have achieved is a result of making correct forecasts and making the right choices in terms of sectors. "Our target is to work efficiently and be influential in the sectors in which we are active and to grow by increasing capacity and by making acquisitions," he says. Özdemir, who plans to make investments of $1 billion every year, has two dreams: The first is to be one of the 10 leading companies in six different sectors in Turkey and the second is to achieve the same success abroad. We spoke with Limak Holding Board Chair Nihat Özdemir about the group's performance over the last 10 years.

Capital: You have grown very rapidly over the last 10 years. To what do you owe this?
- Our rapid growth can be attributed not only to our success in tenders but also to our effective forecasts regarding infrastructure. The correct investment decisions and correct conjunctions have supported our growth. But most important of all is our choice for investments of sectors which are growing rapidly. When you look at the last 10 years, it has been the energy, construction, cement, air transportation and tourism sectors which have
always recorded high-growth. Of the six sectors in which we have invested, five are  amongst the fastest growing sectors in Turkey.

Capital: When was your most important turning point in terms of growth?
 - For Limak, the most important turning point was entering the cement sector in 2000. We evaluated the privatisation tenders very well here. Later we began our investments in energy and airports. We used the experience had acquired in contracting in these fields. Today our group comprises 70 companies
employing 20,000 personnel. Our turnover has risen to $2 billion. This year, our new investments will enable us to grow by 20 percent and reach $3 billion.

Capital: How has the breakdown of your revenue changed at the last 10 years?
- Of course, there have been important changes. The most important is that until last year construction was still our number one sector in terms of turnover. But from this year onwards the balances in our group will change. Energy, cement and airports are growing rapidly. At the moment, 35 percent of our turnover comes from construction and 20 percent from energy. But this rate will change rapidly in favor of energy. In 2013, energy will definitely overtake construction and become our number one business.~

Capital: What were the strategies that resulted in you becoming from scratch one of the top three players in the sector?
- In 2000, we bought the cement company Kurtalan Çimento in Siirt. We increased its capacity by 100 percent. We invested in technology and secured important advantages in terms of cement production costs. As a result, we began to make our name known in the fiercely competitive cement sector. We made new investments and increased the number of factories. In 2006, we prepared very well for some tenders and bought Diyarbakir Çimento and Gaziantep Çimento from the Savings Deposit Insurance Fund. Later, we added Urfa Çimento to our group. In addition to this, we established two cement factories in Bitlis and Mardin. Last year we bought four  cement factories from the Italians in Istanbul, Kirklareli, Ankara and Pinarhisar. In this way, we became the third largest cement group in Turkey after Sabanci and Oyak.

Capital: What is next? Will you make any new acquisitions?
- We are expanding the cement factories we bought in western Turkey through investments in both capacity and efficiency. In cement in particular, we are eagerly looking for new acquisitions in Turkey. We are also working on establishing a cement plant abroad.

Capital: What are you doing in energy? What are your plans?
- At the moment we have six power stations in Turkey. In energy we have a total installed capacity of 600 MW and we produce 2 billion kwh of energy. To date, we have invested $1.5 billion in energy. In the future, we are targeting growth in hydroelectric power plants. We are aiming to establish one or two power plants every year. I believe that diversity is absolutely essential in energy. Our target is to establish coal-fired and natural gas power plants. If we have the opportunity, we shall also establish wind-driven power plants. One of our future targets is to become involved in solar energy as well. Our investments in energy will total $3 billion. We shall have a very important place in the energy sector in Turkey.

Capital: Do you have plans to enter new sectors?
- Our targets is to focus on six sectors, not to enter any other fields, and concentrate on growing and working efficiently in the areas in which we are already active. We want to take our experience in these sectors abroad. As a result, we are aiming to grow in the sectors in which we are active through increases in capacity and acquisitions. I am not thinking of becoming involved again in the alcohol sector. The list of sectors in which I am definitely not thinking of becoming involved is headed by banking.

Capital: In the future, how much will you invest and in which fields?
- Over the next five years we are aiming to invest an average of $1 billion a year. The biggest investments will be in energy. Another one of our important targets is growth in foodstuffs. But we are not thinking of becoming involved in retailing in this sector. I am looking to diversify and expand our businesses in fruit juice and tomato paste.~

Capital: What kind of dreams did you have when you established Limak? What dreams do you have now?
- I dreamt of being one of the 25 largest contracting firms in Turkey. But I could not foresee how we would grow in industry and which sectors we would enter. When we come to today, my dream is not to be the first in every sector in which we are active. On the contrary, I am dreaming of being one of the leading 10 companies in the six sectors in which we are active in Turkey and also of being successful abroad.