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First Abu Dhabi Bank (FAB) is in advanced negotiations to purchase a 61.2% stake in Istanbul-based lender Yapı Kredi from Turkish conglomerate Koç Holding for approximately $8 billion, according to three sources familiar with the matter.
Final details of the potential deal for Türkiye’s fourth-biggest private bank are being hammered out after several months of negotiations, the sources said on condition of anonymity because the talks are confidential.
Shares in Yapı Kredi rose as much as 6.7% in Istanbul after the news emerged, while Koç Holding was up 3.7%. FAB shares were flat.
One of the sources said the Turkish conglomerate had sought about $8.5 billion for its shares in Yapı Kredi and that FAB had offered about $7.5 billion.
FAB, the United Arab Emirates’ largest bank by assets, and Koc Holding declined to comment.
Koç Financial Services owns 40.95% of Yapı Kredi, while Koç Holding owns 20.22%.
The bank has a market value of around $9 billion, up from about $7.5 billion early last month. A second source said the estimated sale value would value the entire bank at between $13 billion to $14 billion.
Any deal would mark the latest Gulf investment in Türkiye and comes amid warming in relations with the UAE and Saudi Arabia in recent years.
Last year, Türkiye and the UAE signed a free trade agreement and then said they agreed a series of deals worth more than $50 billion after President Recep Tayyip Erdoğan’s visit to the region in July.
Türkiye’s economy and its banks are on a sounder footing after a shift toward more orthodox policies since last summer, including aggressive interest rate hikes that helped rebuild foreign exchange reserves.
It was unclear whether FAB and Koç would ultimately reach a final deal, which could depend in part on Yapı Kredi’s second-quarter financial results, set to be announced next month.
FAB and other Gulf banks have benefited as regional governments boost investment and diversify economies away from oil revenues. Last year, the Emirati lender said it had briefly considered bidding for London-listed Standard Chartered.
After Bloomberg reported in April that FAB was studying potential targets in Türkiye, including Yapı Kredi, Koç said in a statement to the stock exchange regarding the report that there was no development that required a public disclosure.
In 2022, Italian bank UniCredit completed the sale to Koç of its remaining 18% stake in 80-year-old Yapı Kredi.
