Private equity deals set for big boom in and around Mideast
http://archive.gulfnews.com/articles/08/03/04/10194638.html
03/04/2008 07:19 PM | By Babu Das Augustine, Banking Editor
Dubai: The Middle East North Africa and South Asia (MENASA) region is set for a big boom in private equity deals this year and the next few years, according to leaders of private equity industry in the region.
Speaking ahead of the Fourth Private Equity International Middle East Conference to be held in Dubai on Tuesday and Wednesday industry representatives said the region is fast emerging as a hot target for private equity investors from across the world as the regional private equity sector is becoming a part of the mature emerging market private equity industry.
Dubai International Capital, the private equity arm of Dubai Holding has about 10 per cent of its total assets under its management invested in the region. The company expects this share to increase substantially during the next few years.
New horizon
"The regional governments are keen to privatise, private family businesses are becoming more open to private equity participation and international private equity firms and professionals are seeing the region as an important investment destination. We see huge opportunities in the horizon and are ready to utilise them," said Sameer Al Ansari, executive chairman and chief executive of Dubai International Capital.
International speakers attending the conference said Middle East is fast maturing as a fundamentally strong market.
"Last year private equity firms across emerging markets raised $59 billion. Out of this about 10 per cent was from the Middle East. Within the region Gulf States are becoming a very important source of capital," said Sarah Alexander, founding president of the Emerging Market Private Equity Association.
The huge infrastructure developments underway in the region combined with the transition of family owned private enterprises are expected be a catalyst in the growth of private equity in the region, according to Arif Naqvi, Vice Chairman and Group Chief Executive Officer, Abraaj Capital.
"We see the boom for at least 10 years ahead. Even if the oil prices are to tumble by 50 per cent from the current level, the region will be still left with trillions of dollars in surplus to support the infrastructure development and the economic growth," said Naqvi.
The economic boom in the region, according to private equity industry players has increased the acceptability of the industry in the region.
"There is a huge funding gap in the region. While the banks have been typically into name lending and asset lending, the region lacks equity funding in the form of Angel funds, venture capital or private equity. What we see is just the beginning of a big trend," said Ansari.
Sovereign funds
While the big international private equity players have just started to make acquisitions here, experts said sovereign wealth funds would follow these funds into the region.
"Sovereign funds which have emerged big source of capital will soon turn their focus on assets closer home," said Howard S. Marks, chairman of Oaktree Capital.
Keeping up with the growth, the regional private equity industry witnessed substantial growth in fund raising activity.
According to latest figures from Abraaj Capital, PE firms raised a cumulative $22.8 billion from 2002 to 2007 with six firms accounting for 50 per cent of the fund raising activity in the region.
Leading private equity players in the region said yesterday that the international credit crunch would not affect the regional firms or deals.
"It is a fact that firms will have to accept some amount of widening credit spreads. However, availability of funds will be abundant because of the bulging regional liquidity and funds from the developed world looking for emerging opportunities," said Naqvi.
Acquisition: Abraaj buys 40% of Bosicor
Abraaj Capital, a leading regional private equity firm focused on Middle East, North Africa and South Asia (MENASA) announced yesterday that it has acquired a 40 per cent stake in the holding company of Bosicor Group (Bosicor), one of Pakistan's leading integrated oil companies.
The private equity deal provides Abraaj with 40 per cent shareholding in Bosicor's two group companies: Bosicor Oil Pakistan Limited and Bosicor Chemical Pakistan Limited. Abraaj will also acquire a minority stake in Bosicor Pakistan Limited (BPL.
The group's subsidiary, BPL, currently operates the fifth-largest oil refinery in Pakistan, with a rated capacity of 30,000 barrels per day (bpd) and a market share of 12 per cent. Established in 1995, BPL is listed on all three stock exchanges in the country. The investment in Bosicor was made through Abraaj Capital's $2 billion Infrastructure and Growth Capital Fund (IGCF).
The investment will fund the establishment of a petrochemical plant and a refining unit that will provide the Bosicor Group with an initial aggregate refining capacity of 145,000 bpd and create an integrated platform that operates across the full value chain in the oil sector.
"This investment in the future of Pakistan - one of many made by Abraaj Capital and the first by IGCF - will greatly enhance the country's ability to fuel its ongoing economic expansion," said Arif Naqvi, Vice Chairman and Group Chief Executive Officer, Abraaj Capital.
Private Equity and Capital Finance Issues for the Global and Emerging Markets with Special Attention to GCC and MNEA Regions.
David West Smith
Director
Global Emerging Technologies
5.3.08
3.3.08
Unicorn Global Private Equity buys into Bahraini firm
Unicorn buys into Bahraini firm
Manama: Tue, 04 Mar 2008
Unicorn Investment Bank said its unit Unicorn Global Private Equity Fund I
has acquired a 55 per cent equity stake in Manama-based Gulf Strategic Partners (GSP), which operates throughout the GCC and India.
The investment in GSP is the fifth one by Unicorn’s Private Equity Fund, an official said.
The company's previous investments include Orimix Concrete Products, a leading ready-mix concrete producer based in Fujairah, UAE; Al Assriya Industries Holding Company in Kuwait and US-based companies Precision Time in Utah and Ellington Leather in Oregon.
Established in 2004, GSP specialises in pre-operational cleaning services for petrochemical, power, oil and gas and process facilities.
GSP has partnerships with international companies to provide high-technology, world-class solutions to industry in the GCC.
GSP’s services include chemical cleaning, steam blows, hydromilling, high velocity flushing and decontamination cleaning.
GSP’s unique technology solutions allow cleaning of new and existing facilities much faster and more effectively than conventional technology. The demand for such services is growing rapidly as new plants are commissioned across the region.
Commenting on the acquisition, Aamir Khan, managing director of Global Private Equity at Unicorn, said: “GSP has developed outstanding technology solutions to serve the largest industries in the region – oil, gas and power. There is growing demand for their services and they have already developed relationships with some of the largest players in the region, which is remarkable for such a young company."
"We look forward to working with GSP’s highly experienced management team to support the company’s next phase of growth throughout the region," he noted.
Wayne Giles, managing director of GSP, said, "Our partnership with Unicorn will provide us with the capital we need to grow our business and take it to the next level. We are witnessing tremendous demand for our services and are excited at the opportunity of working with Unicorn’s team to explore regional expansion opportunities," he added.-TradeArabia News Service
Manama: Tue, 04 Mar 2008
Unicorn Investment Bank said its unit Unicorn Global Private Equity Fund I
has acquired a 55 per cent equity stake in Manama-based Gulf Strategic Partners (GSP), which operates throughout the GCC and India.
The investment in GSP is the fifth one by Unicorn’s Private Equity Fund, an official said.
The company's previous investments include Orimix Concrete Products, a leading ready-mix concrete producer based in Fujairah, UAE; Al Assriya Industries Holding Company in Kuwait and US-based companies Precision Time in Utah and Ellington Leather in Oregon.
Established in 2004, GSP specialises in pre-operational cleaning services for petrochemical, power, oil and gas and process facilities.
GSP has partnerships with international companies to provide high-technology, world-class solutions to industry in the GCC.
GSP’s services include chemical cleaning, steam blows, hydromilling, high velocity flushing and decontamination cleaning.
GSP’s unique technology solutions allow cleaning of new and existing facilities much faster and more effectively than conventional technology. The demand for such services is growing rapidly as new plants are commissioned across the region.
Commenting on the acquisition, Aamir Khan, managing director of Global Private Equity at Unicorn, said: “GSP has developed outstanding technology solutions to serve the largest industries in the region – oil, gas and power. There is growing demand for their services and they have already developed relationships with some of the largest players in the region, which is remarkable for such a young company."
"We look forward to working with GSP’s highly experienced management team to support the company’s next phase of growth throughout the region," he noted.
Wayne Giles, managing director of GSP, said, "Our partnership with Unicorn will provide us with the capital we need to grow our business and take it to the next level. We are witnessing tremendous demand for our services and are excited at the opportunity of working with Unicorn’s team to explore regional expansion opportunities," he added.-TradeArabia News Service
Emërtimet:
Bahrain,
Dubai UAE Private Equity,
GCC Private Equity,
Qatar,
UAE,
venture capital
2.3.08
Middle East IPO firms appreciate by 201% in 2007
Middle East IPO firms appreciate by 201% in 2007
INTERNATIONAL. GCC stock markets are poised for a glut of over 80 Initial Public Offerings (IPOs) which could be worth in excess of US$ 10.5 billion over the next three years. Significantly, IPOs measured in 2007, appreciated on average by 201%, even with over-subscription per IPO falling to a more realistic 6.3 times, according to industry reports.
“To realise an average return of 201% despite regional market depreciation of 9% last year, is an extraordinary achievement. Investors, both regional and international will undoubtedly be drawn to the upcoming IPOs over the next three years,” commented Deep Marwaha, Senior Conference Manager of the 3rd Middle East IPO Summit.
Abu Dhabi-based Gulf Capital identified 83 maiden offers in the GCC, for which, managers have been assigned for 42 and another 41 have announced their intention to tap the equity market. The total number of IPOs in the GCC during the 2007-2010 period is expected to exceed 116, including 33 in 2007 and 83 offers in the coming years.
Morgan Stanley estimates a total of 110 IPOs in Saudi Arabia alone by the end of next year. The bank's Saudi unit has mandates to manage seven IPOs this year, including one by Saudi Basic Chemical Industries (SABIC) that may raise US$80 million.
In the UAE, the National Bank of Abu Dhabi (NBAD) has already announced it expects to manage at least eight IPOs this year, with three aiming to raise at least US$1 billion by the end of June. NBAD managed three IPOs last year and one so far this year.
The total raised by IPOs increased by 40% year-on-year to US$10.5 billion during 2007 with the UAE witnessing US$5.1 billion, followed by Saudi Arabia (US$4.81 billion), Qatar (US$389 million), Oman (US$156 million) and Bahrain (US$69 million).
One reason for such a market-bucking performance is widely put down to the pricing strategy of public offerings in the GCC. “Many IPOs last year were sold at a discount to book value and to earnings and appreciated quickly once on the market,” said Marwaha.
The nerves of investors have also been soothed by the sound regional market fundamentals and high levels of liquidity, not to mention GDP growth and record budget surpluses. “The GCC oil revenues are currently US$ 1.2 billion per day. With tensions over Iran and political posturing by Venezuela, any notion of softening prices were dispelled recently when oil prices shot back up towards US$ 100 per barrel,” added Marwaha.
In addition the region’s non-oil sectors are now beginning to make sizeable contributions towards GDP growth. "Most GCC governments have outlined more than US$1 trillion in capital expenditure for oil and non-oil sectors in the next five-to-six years, which will have a multiplier effect for the private sector which will require more funds to be raised in the stock markets," noted Marwaha.
Middle East’s IPO Summit which takes place on 16-19 March 2008 at the Abu Dhabi Intercontinental Hotel, will host investment experts, regulators and market leaders who will examine regulatory issues as well as new products and issues impacting the investment environment and includes a Middle East Investment Day with an Executive Masterclass by contrarian investment guru, Hong Kong-based Dr Marc Faber.
The Middle East IPO Summit Chairman is Mamdoh Al Rouhani, Managing Director of MS&L, Saudi Arabia. "With large IPOs in the pipeline across many Middle Eastern markets, the need for professionals to share information and network with each other is more important than ever," he said.
Among the market movers and shakers taking part in the Summit will be speakers from the Global Investment House, Deutsche Bank, Ithmar Capital, Abraaj Capital, Algebra Capital, AB Capital, The National Investor, NBK Capital, Jeffries, KPMG, Emirates Financial Services, Rasmala Investments, Calyon, UBS, Alpen Capital, Samba Financial Group and Bank of New York Mellon.
For more information on the 3rd Middle East IPO Summit visit www.iposummit.com
Author: Moussa Ahmad
Source: BI-ME
Published: 02 March 2008
INTERNATIONAL. GCC stock markets are poised for a glut of over 80 Initial Public Offerings (IPOs) which could be worth in excess of US$ 10.5 billion over the next three years. Significantly, IPOs measured in 2007, appreciated on average by 201%, even with over-subscription per IPO falling to a more realistic 6.3 times, according to industry reports.
“To realise an average return of 201% despite regional market depreciation of 9% last year, is an extraordinary achievement. Investors, both regional and international will undoubtedly be drawn to the upcoming IPOs over the next three years,” commented Deep Marwaha, Senior Conference Manager of the 3rd Middle East IPO Summit.
Abu Dhabi-based Gulf Capital identified 83 maiden offers in the GCC, for which, managers have been assigned for 42 and another 41 have announced their intention to tap the equity market. The total number of IPOs in the GCC during the 2007-2010 period is expected to exceed 116, including 33 in 2007 and 83 offers in the coming years.
Morgan Stanley estimates a total of 110 IPOs in Saudi Arabia alone by the end of next year. The bank's Saudi unit has mandates to manage seven IPOs this year, including one by Saudi Basic Chemical Industries (SABIC) that may raise US$80 million.
In the UAE, the National Bank of Abu Dhabi (NBAD) has already announced it expects to manage at least eight IPOs this year, with three aiming to raise at least US$1 billion by the end of June. NBAD managed three IPOs last year and one so far this year.
The total raised by IPOs increased by 40% year-on-year to US$10.5 billion during 2007 with the UAE witnessing US$5.1 billion, followed by Saudi Arabia (US$4.81 billion), Qatar (US$389 million), Oman (US$156 million) and Bahrain (US$69 million).
One reason for such a market-bucking performance is widely put down to the pricing strategy of public offerings in the GCC. “Many IPOs last year were sold at a discount to book value and to earnings and appreciated quickly once on the market,” said Marwaha.
The nerves of investors have also been soothed by the sound regional market fundamentals and high levels of liquidity, not to mention GDP growth and record budget surpluses. “The GCC oil revenues are currently US$ 1.2 billion per day. With tensions over Iran and political posturing by Venezuela, any notion of softening prices were dispelled recently when oil prices shot back up towards US$ 100 per barrel,” added Marwaha.
In addition the region’s non-oil sectors are now beginning to make sizeable contributions towards GDP growth. "Most GCC governments have outlined more than US$1 trillion in capital expenditure for oil and non-oil sectors in the next five-to-six years, which will have a multiplier effect for the private sector which will require more funds to be raised in the stock markets," noted Marwaha.
Middle East’s IPO Summit which takes place on 16-19 March 2008 at the Abu Dhabi Intercontinental Hotel, will host investment experts, regulators and market leaders who will examine regulatory issues as well as new products and issues impacting the investment environment and includes a Middle East Investment Day with an Executive Masterclass by contrarian investment guru, Hong Kong-based Dr Marc Faber.
The Middle East IPO Summit Chairman is Mamdoh Al Rouhani, Managing Director of MS&L, Saudi Arabia. "With large IPOs in the pipeline across many Middle Eastern markets, the need for professionals to share information and network with each other is more important than ever," he said.
Among the market movers and shakers taking part in the Summit will be speakers from the Global Investment House, Deutsche Bank, Ithmar Capital, Abraaj Capital, Algebra Capital, AB Capital, The National Investor, NBK Capital, Jeffries, KPMG, Emirates Financial Services, Rasmala Investments, Calyon, UBS, Alpen Capital, Samba Financial Group and Bank of New York Mellon.
For more information on the 3rd Middle East IPO Summit visit www.iposummit.com
Author: Moussa Ahmad
Source: BI-ME
Published: 02 March 2008
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