International new wire Reuters reported in April that Singapore sovereign wealth fund Temasek – together with Britain’s Metric Capital – invested $200 million for a 17% stake in Turkey’s Dogus Restaurant Entertainment and Management (D.ream) – a conglomerate that has 42 restaurants to its name.
D.ream is perhaps best known for the Nusr-Et steakhouse chain became extremely hyped up last year after restaurant owner Nusret Gokce “Salt Bae” shot to fame after a video of him cutting a slab of meat and sprinkling salt with a flourish in his signature style went viral.
The hyped restaurant chain, however, has drawn flak for being a “ripoff” and has accumulated poor reviews from several customers and food reviewers alike. The New York Post was one such publication that wrote in a restaurant review that the dishes at the “underwhelming” restaurant were “overpriced”.
Like the journalists at The New York Post, writers at Eater New York also reported that they “went away still hungry.” Other customers have also complained that the dishes are priced exorbitantly for meagre portions, and that the taste of the dishes isn’t extraordinary either. Many have opined that the restuarant chain is popular not because of the food but because the outlets are “Instagrammable”.
A month before Temasek acquired a sizeable stake in the parent company of Salt Bae’s restaurant, Singaporeans expressed concerns and asked: “How much more money do they have to lose?”
Today, these concerns are edging ever closer to becoming a reality as D.ream’s parent company Dogus Group faces severe debt restructuring woes, barely four months after the wealth fund sunk $200 million into its subsidiary.
Nasdaq reported earlier this month that Dogus has encountered disagreements with its creditors over how its maturing loans valued at $2 billion Euros or S$3.19 billion should be paid.
This $2 billion Euros only represents about half of Dogus’ debt woes. Combined outstanding loans stood at a whopping 23.5 billion lira or S$6.55 billion at the end of last year, climbing by a hefty 11 per cent since 2016.
Reuters reported that Dogus is in talks with lenders Yapi Kredi and Isbank but that rival Akbank wants the debt to be collected as soon as possible. Akbank is Turkey’s third-largest listed bank by assets. An unnamed source told the news agency: “There is a disagreement over the maturity. Akbank does not agree with the loan maturity offered by Yapi Kredi and Isbank.”
Meanwhile, a hefty 16 per cent decline of the Turkish currency is compounding issues by adding further stress to Turkish companies. The currency decline is creating difficulties for Turkish businesses to pay off foreign debt as repayment becomes more expensive.
This is especially worrisome given estimates that Turkish businesses owe as much as $225 billion in long-term overseas loans as of April 2018. In the wake of the crrency decline, several Turkish conglomerates are resorting to selling assets or refinancing their businesses to overcome the debt crisis.