Merrill Lynch said in a research report that it had upgraded Turkey“s T.Sise ve Cam Fabrikalari AS to accumulate after the company“s recent acquisition of glassmaker Trakya Cam.
“SiseCam“s 50% sta…
Merrill Lynch said in a research report that it had upgraded Turkey“s T.Sise ve Cam Fabrikalari AS to accumulate after the company“s recent acquisition of glassmaker Trakya Cam. “SiseCam“s 50% stake in near-monopoly flat glass producer Trakya Cam should lead to upside as we expect Trakya will benefit from reconstruction efforts in Turkey,” Merrill said. “Should Trakya hit US$ 300 million market capitalization (just 5.9 times 1998 International Accounting Standards earnings which can again be matched), the remainder of Sise“s business would trade at 30% of sales, 3.8 times enterprise value/earnings before interest, tax, depreciation and amortization and less than half book,” Merrill said. “Yet the remaining Sise businesses reported losses in 1998 and continue to do poorly. Although we unquestionably prefer Trakya Cam, we believe sentiment and the low asset values of the remaining business argue for an upgrade,” Merrill said.