Mannesmann Boru and Borusan Boru to be under same roof
According to recent news from the industry, Mannesmann Boru is going to merge with Borusan Boru, one of the first five steel pipe producers in Europe, based on the decision of Borusan Boru's board. This merger is certainly in favor of Borusan Boru as its range of products will expand in addition to production capacity which will reach up to 750'000 ton levels from current 400'000 tons. Besides, total sales turnover will pass $300 million with this merger. On the other hand, Mannesmann Boru produces both spiral and longitudinally welded pipes and took on several major pipeline projects in Turkey and neighboring countries requiring spiral welded large pipes such as water, gas and petroleum. However Mannesmann Boru is an exclusive company and Borusan Boru, as being a public company, aims to improve its value and strengthen its presence in capital market through this merger. Borusan Boru and Mannesmann are valued at $92 million and $64 million in the market, respectively. Futhermore Borusan Boru is planning to expand in Europe, Middle East and North Africa. In line with its strategy, company is trying to create a market share in Iraq through sales until favorable market conditions for production are reached. Although Borusan Boru reported considerable increase in sales revenue for the first nine months of 2003, its profit margins dropped due to shrinking construction industry in Turkey during 2003. However, it is likely that the situation will be just the opposite this year as revival is expected in deferred demand in construction industry and housing project for 2004 will increase activity.