Borusan




 

REPORTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2008 (Continued)

(Currency - US Dollars unless otherwise indicated)

1. CORPORATE INFORMATION

General

Borusan Holding A.Ş. and its Subsidiaries (hereafter referred to as "the Borusan Group" or "the Group") commenced operations in 1944 as Borusan İstikbal Ticaret T.A.Ş., a company, trading steel products and exporting dried fruit.

Borusan Holding A.Ş. ("Borusan Holding" or the "Holding") was established in December 1972 as a corporation to coordinate the activities of and liaise between companies operating in different fields including steel business (pipe and flat steel production), distributorship of leading brands (BMW, Land Rover and Caterpillar), integrated logistics and investments in telecommunication industries. Borusan Holding is registered in Turkey and owned by members of the Kocabıyık Family (see Note 20). The registered address of the Holding is as follows:

Meclisi Mebusan Caddesi No: 35-37
Fındıklı - İstanbul - Turkey

According to the Extraordinary General Assembly Meeting resolution dated 13 March 2007, shareholders of the Holding have resolved to merge with Borusan Ticari Sinai Danışmanlık ve Ticaret A.Ş. ("BTS"). The merge has been finalized based on the financial statements of BTS and all the assets and liabilities of BTS have been transferred to the Holding as of 28 February 2007. The shareholding structure of Borusan Holding has not changed after the merger with BTS since the shareholders and shareholding percentages of BTS and Borusan Holding were identical.

Nature of Activities of the Group

The principal activities of Borusan Group comprise the following:

Since September 1998, Borusan Holding has a controlling interest in a sub-holding company, Borusan Mannesmann Boru Yatırım Holding A.Ş., which was established to coordinate the activities of Borusan Birleşik Boru Fabrikaları A.Ş., a listed company in the İstanbul Stock Exchange (ISE), and Mannesmann Boru Endüstrisi T.A.Ş. (entities under common control) operating in the pipe manufacturing business. In the Extraordinary General Assembly of Shareholders held on 25 November 2004, Borusan Birleşik Boru Fabrikaları A.Ş. shareholders approved the merger with Mannesmann Boru Endüstrisi T.A.Ş. The merger is effected through dissolution without liquidation and take-over of Mannesmann Boru Endüstrisi T.A.Ş. by Borusan Birleşik Boru Fabrikaları A.Ş., as a whole together with its assets and liabilities. Following the merger, company title of Borusan Birleşik Boru Fabrikaları A.Ş. has been changed to and registered as Borusan Mannesmann Boru Sanayi ve Ticaret A.Ş. on 13 December 2004. In addition, Borusan Holding controls three investment companies; Borusan Yatırım ve Pazarlama A.Ş., a listed company in the ISE, Borusan İstikbal Ticaret T.A.Ş. and Borusan Teknolojik Yatırımlar Holding A.Ş.

The Group is organized mainly in Turkey into four main business segments:

Other operations of the Group mainly comprise telecommunications and engine valves production.

Borusan Holding has the following subsidiaries (”the Subsidiaries”). Business segments and the locations of Subsidiaries are as follows:

1 This entity is in the liquidation process.