Mehmet Zorlu, established their Group’s first company in the early 1950s, he laid the ground rules for the Zorlu Group’s subsequent growth: integrity, perseverance and unconditional commitment to quality. Integrity is the Group’s cornerstone value and they expect it to govern every aspect of their business. Hard work and perseverance are essential for the day-to-day success of their enterprises as they are for the undertaking) of a new venture. Quality is the key to customer loyalty, on which the long-term prosperity a f all ventures depends.
With these ground rules, the Zorlu Group has sought to develop solid and profitable businesses that contribute to the welfare of the Group; its customers, business partners and employees; as well as the larger community. Until the early 1990s, they focused their investments in home textiles, an activity the Zorlu family has been involved with for several generations and in which they have a particular expertise. In 1994, they saw the opportunity to employ their strong capital and human resources in the consumer electronics sector, through the acquisition of the Vestel electronics Group.
This was followed, in 1996 and 1997, by investments in the fast- growing energy and financial services sectors. Between 1990 and 1997, they tripled the number of their operations, increasing their total assets to just under US$ 1 billion, excluding the assets of five of their six subsidiaries incorporated abroad. They invested in state-of the-art spinning, weaving and textile technology that has made them the worlds largest; vertically-integrated polyester curtain producer and will propel them to the forefront of the international home textile industry in the years to come.
They acquired the Vestel Group of consumer electronics companies, pushed its balance sheet from an undeserved red into the black, and set it on course to become a leading contender in the international consumer electronics markets. They established a bank, a leasing company and o factoring firm and they penetrated the power generation and electricity distribution sectors with the construction of two plants and a; competitive bid for o state- owned, plant slated for privatization.
The Zorlu Group’s rapid growth since 1990 reflects the vast range of opportunities that have emerged from the unique juncture of Turkey’s Customs Union with the European Today, their operations include 32 companies in Turkey, France, Germany, Holland and South Africa in the textile, consumer electronics, finance, energy and tourism sectors. In 1997, their key operations achieved net sales of almost US$ 750 million and after tax profits of just under US$ 80 million.
That the Zorlu Group was able to choose its projects well and bring these to successful fruition during a period of significant economic and political uncertainty is a reflection of their strategic corporate vision, their sound business principles and their strong management capability. Mehmet Zorlu, a textile manufacturer with a vision of Turkeys textile potential long before their country had made its mark on international markets, founded the Zorlu Group of companies in the early l950s.
At an early date, Mehmet Zorlu endowed the Group with o rare combination of values honesty, dedication to quality, commitment to long-term goals and the courage to take calculated risks that reward hard work. Today; these values are the foundation o f their corporate culture and constitute the basis for their key business principles unconditional customer satisfaction and mutually beneficial partnerships. The Zorlu Group is committed to constantly improving the quality and enhancing the range of its products and services.
That is why they have sought to expand their product range in the consumer goods categories where they are active and to ensure, through ceaseless research and development, that their products best reflect the demands of their consumers and the latest technological developments. Likewise, they are committed to developing strong and long-term relationships with their customers, their employees, their suppliers and their shareholders. Their aim is to provide their customers with high quality products and services, to exact specifications and on competitive terms, and they expect their suppliers to do the same for us.
They also expect their human resources to be the very best in their areas of expertise, so they have set an unlimited budget for training to help them achieve this performance. First-class human resources are essential if they are to achieve the strong financial results that their shareholders deserve and which their recent performance confirms they can attain. They are proud of their achievements over the last decade, but they are not prepared to rest with these. (Zorlu Holding Company Profile) The Goal Of The Zorlu Group
To strengthen their global reach, from the Far East to the American continents, through strategic and long-term partnerships, care fully planned investments at home and abroad and focused research and development. The Zorlu Group is always open to exploring strategic partnerships that will expand their international markets, enhance their product range and contribute to their technological know-how. Currently, they are considering several long-term partnerships in consumer electronics for research and development, technology transfer, customized production and manufacturing facility sharing in international markets.
The Zorlu Group’s investment strategy To reinforce its capacity, technological lead and vertical integration in its primary areas of activity while creating new capacity in selected high-growth sectors. In the textile sector, they hove invested more than US$ 500 million in several projects that will more than triple their polyester yarn capacity and double their curtain fabric output, These include a vertically-integrated, cotton-based home textile plant that is the world’s third largest in terms of capacity and unparalleled in its cutting-edge technology.
In South Africa, they initiated construction o f a manufacturing facility that will come on stream in 1998 and supply the fast-growing demand for curtain fabric in the region. In France, they acquired majority shareholding of Bel-Air Industries, one of the largest home textile producers in Europe. Bel-Air has three manufacturing facilities, a wide range of internationally renowned brands and a distribution network of 5,000 dealerships in France and Germany.
In the consumer electronics sector, they have expanded their television production capacity four-fold since 1995 and more than doubled their capacity for television components tuners, remote controls and satellite receivers. At ‘ the same time, they have incorporated new technologies that have enabled them to launch innovative products; such as. wide-screen televisions and information appliances, They have also initiated construction of a new manufacturing plant that will produce static and no-frost refrigerators under Sanyo license in-early 1999.
While deepening their traditional lines of business, the Zorlu Group has expanded into new areas of activity where they believe they have a competitive advantage. Their decisive entry into the financial sector reflects their conviction that they have the human resources; the international standing and the capital strength to become one of the top five mid-sized financial groups in Turkey. Their US$ 150 million investment in power generation, motivated by the Group’s large demand for high quality and economical energy, has prepared them to compete for Turkey’s large-scale energy privatization projects.
The Zorlu Group is not afraid to grow because they believe they choose their projects prudently, but they also recognize that growth must be managed. That is why they are investing in their human resources, reinforcing their management capability with integrated business software and drawing heavily on external consultancy. They are not embarrassed to learn from others how to strengthen their business. Nor do they shy away from licensed technology.
On the contrary, they prefer to learn as much as they can from others because they can then focus on what they do best; making better products, providing higher quality services and improving the return for their shareholders. Turkey is a country, which has an incredible opportunity, though its potential has recently been clouded by economic and political instability and one of the highest inflation rates worldwide. Having confirmed what they can achieve in this difficult environment, they are confident in the Zorlu Group’s future and look forward to sharing this with the customer. (http://www. rlu. com. tr)
Group In 1994, the Zorlu Group became a leading contender in the consumer electronics market when it acquired, Vestel Electronics. Founded in 1984, the Vestel Group comprises four manufacturing and six marketing and distribution companies in the consumer electronics, white goods and information technology sectors. The Group’s products include color televisions, personal computer monitors, set-top- box satellite receivers, personal computers, television tuners, remote control units, remote control converter kits and Internet boxes.
In 1999, the Group will initiate production of no-frost and static refrigerators. The Vestel Group has been at the forefront of Turkey’s consumer electronics sector since I 984, when it established Vestel Electronics, currently one of Europe’s leading color television producers specialized in OEM. In the following years, the Group expanded vertically into television components, and horizontally into information technology and white goods. Vestelkom, the Group’s components producer, is Europe’s fourth largest manufacturer of television tuners.
In 1987, Vestel established one of Turkey’s first computer assembly operations and subsequently initiated the design and production of monochrome and color PC monitors for export. Vestel’s history in the white goods sector dates back to I 988, when the Vestel Group established a joint venture with a leading Asian durable goods manufacturer to produce microwave ovens, later expanding into production and marketing agreements for refrigerators, washing machines, dishwashers and mini electric ovens.
After nearly a decade of rapid growth, the Vestel Group suffered a brief period of decline under- its previous owner in the early I 990s. This situation was rapidly and decisively reversed by the Zorlu Group, which brought to the Vestel Group new capital resources, an experienced, and entrepreneurial management team and a new focus on quality and customer satisfaction. Between 1995 and 1997, Zorlu Group invested more than US$ 40 million in expanding and modemising the Vestel Group’s capacity and in business reorganization.
Over the same period, the Vestel Group raised its consolidated net sales and exports by respectively 148% and 190% in US$ terms and its after-tax earnings by more than 500%. The Vestel Group’s rapid recovery reflects its majority shareholder’s commitment to unconditional customer satisfaction through new and improved products, greater product features and accessible prices. It also reflects the far-sighted manufacturing strategies of its management team. (http://www. vestel. com. tr) Vestel’s manufacturing strategy Quality, innovation, and quick response.
To support this, the Group is continually investing in new technologies, new capacity and greater production flexibility. At the same time, it has pursued vertical and horizontal integration to enhance its control over the final quality of its products and to optimize scales of production. This strategy has enabled Vestel to secure its position as a first-class original equipment manufacturer. Vestel has the production flexibility to meet a wide range of specialized needs and the strict quality controls to ensure consistently high quality products.
Because it is continually investing in new technologies, Vestel is able to launch new products and product features that reflect the very latest trends in the international markets. The Vestel Group’s technological park includes state-of the-art surface mounting and plastic injection machinery, nitrogen-environment automatic soldering machines, quick proto-type machinery and automatic micro-controller software. This advanced technological base is buttressed by the Group’s engineering expertise and in particular, the technical know-how of its research and development teams.
Vestel’s research and design team was the first in Turkey to develop its own television design and the only one to develop micro- controller software for application in its production processes. Currently, it is focusing its efforts on flat panel (plasma display) televisions, line flicker and noise reduction, Dolby sound systems, digital interactive television units, digital video disk players, digital video disk broadcasting decoders, multimedia monitors, video conferencing and chip design.
Vestel Electronics The Zorlu Group’s principal operation in the electronics sector is Vestel Electronics, one of Europe’s leading manufacturers of color televisions. In 1997, Vestel Electronics produced 2,200,000 color televisions and supplied respectively 7. 5 % and 32% of the European and Turkish color television markets. In 1998, the company is increasing its capacity to 4,000,000 units. Vestel Electronics ‘is also the largest producer of personal computer monitors in Turkey, with an annual capacity of 1,000,000 units, and the only manufacturer of desktop personal computers with ISO 9002 certification.
Zorlu Holding Company Profile) Vestel Electronics’ goal Become one of the world’s top three consumer electronics companies. Vestel Electronics is a publicly traded company with 33% of its shares traded on . the Istanbul Stock Exchange; The Zorlu Group owns the remaining 67% shareholding. In 1997, Vestel Electronics ranked among Turkey’s top 10 private enterprises with a turnover of US$ 516 million. Since its establishment in 1984, Vestel Electronics has pioneered the development of the Turkish electronics sector with innovative and high quality products and internationally competitive prices.
After its acquisition by the Zorlu Group, Vestel Electronics embarked on a new period of growth, raising its color television capacity from 400,000 units in 1994 to 2,200,000 units in I 997 and 4,000,000 units in 1998. This rapid expansion has enabled the company to incorporate the latest technological developments in its production processes and to reorganize its productive capacity to best meet the demands of its international clients. Vestel Electronics’ I 00,000 m2 television plant is located in the Organized Industrial Zone of Manisa, 30 kilometers from the Aegean port of Izmir.
The plant employs over 3,000 people and encompasses, all phases of the television production process: research and development; production of printed circuit boards (PCBs), chassis and cabinets; testing and mounting of the final product; production of packaging material and after-sales services. Vestel Electronics sources its chip tuners and remote control units from Vestelkom, another Vestel Electronics Group company. (http://www. vestel. com. tr) Vestel Electronics’ production lines incorporate state-of-the-art surface mounting assembly technology and fully automated testing processes.
Advanced production technology, strict production process controls and a high degree of vertical integration ensure that Vestel’s television sets are of consistently high quality that meet or exceed international standards. Vestel Electronics has a first-class manufacturer’s return rate. Vestel Electronics’ excellent product quality is complemented by an exceptionally high degree of production flexibility. Vertical integration, a strong research and development base and in-house engineering expertise enable Vestel Electronics to produce both small and large batches of customized television sets in record time.
Utilizing pro-engineer CAD/CAM software and prototype machinery, the company can produce full-size models in three to four days and initiate full production in less than one month. Vestel Electronics’ research and development team is preparing to take the lead internationally through licensing agreements with some of the world’s foremost engineering firms and strategic collaboration with several of Turkey’s top technical universities. These partnerships have reinforced the company’s traditional leadership in Turkey and set the stage for new product launches on an international scale.
Vestel Electronics was the first producer in Turkey to produce 100 Hz televisions and the only producer of 16:9 inch, 33-inch, Dolby Surround PrologicTM and digital televisions as of end-1998. In 1998, the company is launching Turkey’s first Internet set-top-box television, Internet. TV. All of these have been designed to meet the technical specifications of Vestel’s key export markets in Europe, Asia, North and South America and Africa, CIS and Australia.
Other areas where Vestel Electronics is focusing its research and development efforts are flat panel plasma display) televisions, line flicker and noise reduction, Dolby sound systems, digital interactive television units, digital video disk players, digital video, disk broadcasting decoders, multimedia monitors, video conferencing and chip design. Vestel Electronics has established an in-house EMC laboratory for CE testing and its research and development team works, closely with authorized certification laboratories to assure that new products meet or exceed. l required international standards.
All of the company’s televisions are produced to BEAB, BS, CE, UL, FTZ, LCIE, TV and VDE standards as well as to the individual standards of its export markets. Vestel Electronics has been operating with ISO 9001 certification since 1993. (Zorlu Holding Company Profile) Vestelkom Vestelkom is a contract manufacturer for the telecommunications industry and Turkey’s leading producer of television tuners, satellite receivers, remote control receiver/transmitter units.
Since early 1998, it is also the only producer of Internet set-top-boxes in Turkey. Vestelkom’s new 20,000 m plant in the Aegean Free Trade Zone near Izmir has the largest component surface mount assembly operation in Turkey, Moreover Vestelkom’s 2,400,000 surface mount device (SMD) chip tuner capacity, as of-end-1997, positioned the company squarely among the top four television tuner producers in Europe. Vestelkom’s leadership in the tuner segment reflects its long experience in the consumer electronics sector and in-house engineering expertise.
Founded in 1975 Vestelkom was Turkey’s first consumer electronics company to produce tuners and remote control unitsfor both monochrome and color televisions and to introduce surface mounting of components. In 1989, Vestelkom began to produce television tuners under Temic license, exporting 100% of its output to his company. Today, Vestelkom continues to export all of its tuners and is forcefully expanding its exports of satellite receivers and remote control units, the latter to countries in the Middle East and Africa where large numbers of television sets are still manually controlled.
To respond to the growing demand for its products, Vestelkom is rapidly expanding both its production capacity and its product range. Vestelkom’s production lines utilize state-of-the-art Fuji and TDK assembly machinery and the latest generation of testing and alignment equipment. Manual and automatic testing is complemented by statistical process controls to ensure that every one of Vestelkom’s chip tuners are produced in line with FTZ and CCIR standards. The company expects to reconfirm its high standards of quality with ISO9002.
As with Vestel Electronics, Vestelkom has developed its own in-house research and development capacity. The company is currently designing satellite receivers, with two analogue receivers under production and one in the development stage. Vestelkom is also on the design for a new remote control transmitter unit with chip-on-board. In the longer run, Vestelkom aims to develop and manufacture products for radio frequency and digital telecommunications. Vestel White Goods was established in 1997 following the group’s successful launch, in 1996, of the VESTEL WHITE brand to the Turkish market.
Vestel White Goods is the Group’s first manufacturing investment in the white goods sector since the Zorlu Group acquired the Vestel Group in 1994. Vestel White Goods is constructing a US$ 100 million static and no-frost refrigerator plant that will have an initial capacity of 600,000 units in early 1999 and a final capacity of 1,200,000 units on its completion at-end-2000 Sanyo of Japan is providing the technical know-how for the plant, which has been designed with a flexible production structure to facilitate customized production.
This flexibility, combined with state-of- the-art technology, will enable the plant to export roughly half of its output to Europe, the CIS, North Africa and the US. Vestel Goods plant is located in the Manisa Organized Industrial Zone Near Izmir. In line with its strategy of developing capacity in the white goods sector, Vestel White Goods is initiating two more manufacturing investments in mid 1998. The first of these is a US$ 80 million facility for producing fully-automatic washing, machines that will have a capacity of 1,000,000 units when it begins operation in the second half of 1999.
The second is a US$ 30 million split air conditioner plant that will have a capacity of 250,000units when completed in early 1999. (Zorlu Holding Company Profile) Vestel Information Technology Vestel Information Technologies provides information technologies services in Turkey as a member of Vestel Group Companies within Zorlu Holding since 1987. It provides information technologies services worldwide by establishing Vestel-USA; the first global company ever established by Turkish capital in Silicon Valley, California, USA.
North and South American operations are managed from the Silicon Valley, European, Middle Eastern and African operations are managed from Turkey and Asia-Pacific operations are managed from Taiwan. Vestel does not only follow the produced, ready made technologies. Three R&D centers were established by the company, one of which is in Silicon Valley where the technology develops rapidly in USA, second one in Taiwan and the other one in Manisa, Turkey. Vestel R&D departments play an active role in electronics and computer technologies with its new technologies and methods.
Today, the opportunity to develop technologies completely cooperation with the leading companies in the field. Therefore, Vestel was established cooperation with giant corporations such as Microsoft, Sun Microsystems, En Reach Technology, SPYGLASS and Integrated Systems in Software field and with Intel, Teralogic, Information Graphics Systems Inc. , Cyrix, GEMPLUS in hardware field and the company continues to conduct can only be possible by establishing strategic cooperation with the leading companies in the field. ttp://www. vestel. com. tr) Vestel Information Technologies have renewed its internal organization to reflect the technological excellence arose from this giant organization and synergy generated from the local information technologies and four giant group companies providing Internet services directly to the customer satisfaction. The new organization consists of two operational groups, one of which is Individual Systems and the other is Corporate Systems.
Vestel Information Technologies is proud to provide services to Turkish citizens as the Turkish Division of this giant organization with its information devices equipped with new technological excellence, product ranges, channel structure formed of distributors, dealership structure and widespread sales points, 40 effective service networks in 24 provinces, specialized partners, unique field knowledge and Promega product range designed for corporate market.
Vestel Information that is in the information sector since 1987 is now provides services in personal computers market by the launch of Vestel Asteo PCs in1996 and corporate systems market by the launch of PROMEGA product range. The company ensured the plant production concept to be used in computer production field with the product quality provided by the input, production, post-production quality control, heat, electrical and mechanical tests and advanced production technologies.
The company achieved to meet the world standards in the production of every single computer and enhanced the quality standards by the special tests conducted. The new computer plant established in Izmir will start its operations on June, 1999 and the investments will be continued to provide production of world class PCs. Vestel started to produce monitors in 1988 with the production of monitors to IBM.
The company started to produce Vestel design monitors as of March 1998. It reached to a capacity of 250K monthly on 5 assembly bands at its plant in Manisa on May, 1999 and it aims to posses a local market share of 80%. Annual target of the company including the exportation is 3 millions. Vestel electronics Monitor Plant is the new indicator of Vestels investments in IT field and its identification of being technology producer not consumer.