Sabanc Holding is a strategic portfolio company that focuses on creating value added within the Groups ecosystem and prioritizes a high-performance culture. The main business areas of Sabanc Group are; banking, insurance, energy, industrials, cement, and retail. Sabanc Group companies are market leaders in most of their respective sectors.

Sabanc Group thanks to its solid reputation, positive brand image, strong joint ventures, extensive experience and know-how about the Turkish market has fostered its core businesses over the years.

Sabanc Holdings multinational business partners include prominent global companies such as Ageas, Aviva, Bridgestone, Carrefour, E.ON, Heidelberg Cement, Marubeni and Philip Morris.

In 2019, Sabanc Group posted combined sales revenue of TL 97.6 billion and consolidated net profit of TL 3.8 billion. Sabanc Holdings own shares, as well as the shares of its 11 subsidiaries, are listed on Borsa Istanbul (BIST) and constitute 8.1% of total market capitalization of Turkish equity market.

Based on the information above, please answer the following:

1. Which type of diversification does Sabanc Holding exemplify? How can a corporation create shareholder value in that type of diversification? Briefly explain.
2. Does Sabanc Holding create value through in your opinion? How? Do its diversification efforts pass the necessary tests? Does it create value through mechanisms identified in part a), or in some other way?
3. Sabanc seems to have diversified into many of these businesses through joint ventures with foreign partners. Discuss some of the benefits and risks of that method of diversification.

1) Sabanc Holding is one of Turkey's largest industrial and services groups. The group operates in multiple industries. Below is a selection of industries in which they operate, along with some of the companies that represent them in each industry (the list is not exhaustive). Industry Product Description Representative Brands Capital Ownership Energy Energy distribution EnerjiSA, Beykent Avedas Toroslar Electricity generation EnerjiSA Uretim Industrial Tires BOSA Joint venture with Goods Bridgestone Cords KordSA Buses, Trucks TemSA Construction machinery TemSA Is Makinalar Financial Insurance, retirement AKSigorta, AvivaSA Joint venture with Aviva Services Finance Bank Akbank Investment AKYatiam Portfolio management AKPortfoy Leasing AK Lease IT Services Information services, SabancDy data analytics Tobacco Cigarettes PhilSA, Philip MoreSA Joint venture with Philip Morris Retail Electronics retailing TeknoSA Food retailing CarrefourSA Joint venture with Carrefour Building Cement AkanSA. CimSA Joint venture with Niaterials Heidelberg Cement 1) Sabanc Holding is one of Turkey's largest industrial and services groups. The group operates in multiple industries. Below is a selection of industries in which they operate, along with some of the companies that represent them in each industry (the list is not exhaustive). Industry Product Description Representative Brands Capital Ownership Energy Energy distribution EnerjiSA, Beykent Avedas Toroslar Electricity generation EnerjiSA Uretim Industrial Tires BOSA Joint venture with Goods Bridgestone Cords KordSA Buses, Trucks TemSA Construction machinery TemSA Is Makinalar Financial Insurance, retirement AKSigorta, AvivaSA Joint venture with Aviva Services Finance Bank Akbank Investment AKYatiam Portfolio management AKPortfoy Leasing AK Lease IT Services Information services, SabancDy data analytics Tobacco Cigarettes PhilSA, Philip MoreSA Joint venture with Philip Morris Retail Electronics retailing TeknoSA Food retailing CarrefourSA Joint venture with Carrefour Building Cement AkanSA. CimSA Joint venture with Niaterials Heidelberg Cement