as PDF - The Abraaj Group

Engineering
Q3 2009
success
Turkey; Ripe for Private
Equity as Economy
Begins Recovery
JorAMCo Renews MRO
Partnership with Royal
Jordanian
GMMOS Grows
Offshore Supply Vessel
Fleet
Bosicor Petchem Plant
Due Mid-2010
Abraaj Wins CSR Award
Contents
Thought Leadership
• Turkey; Ripe for Private Equity as Economy Begins
Recovery, by Selcuk Yorgancioglu
4
Abraaj Buyout Fund (ABOF)
• JorAMCo Renews MRO Partnership with Royal
Jordanian
6
• Karachi Electric Supply Company Appoints New
CEO
10
• Turkey’s Acibadem Shows Resilience as Healthcare
Needs Grow
12
• GEMS Dubai Student Numbers Hold Up Despite
Expat Leaver Concern
13
• Bosicor Petrochemical Plant Due Mid-2010, Italy
Facility Plant Dismantled
14
• Al Borg Expands Lab Network in Egypt, Eyes
Partnerships 15
Abraaj Buyout Fund II (ABOF II)
Abraaj
• GMMOS Expands Offshore Supply Vessel Fleet,
Eyes Asia Growth
7
• ART Marine, Middle East’s Biggest Yacht Dealer,
Appoints CEO
8
• Waqar Siddiqui Promoted to Managing Director • Abraaj Wins CSR Award • ACAP 2010 Winners Chosen
16
17
18
Infrastructure & Growth Capital Fund (IGCF)
This newsletter is printed on 100% recycled paper
About Abraaj Capital
Abraaj Capital is the largest private equity group in the Middle East, North Africa and South Asia (MENASA). Since
inception in 2002, it has raised about US$ 7 billion and distributed almost US$ 3 billion to its investors. Based
in Dubai, it has made more than 35 investments in 11 countries and exited 20. The group operates offices in five
countries, including Saudi Arabia, Egypt and Turkey. About 155 people work for Abraaj, including around 75 worldclass investment professionals. Abraaj Funds hold stakes in some 25 companies, including some of the region’s
most prominent, such as Air Arabia, the region’s biggest low-cost carrier; Acibadem Healthcare Group, Turkey’s
biggest privately owned operator of premium hospitals; and Al Borg, the Middle East’s biggest medical-testing
laboratory company. Abraaj has won several international awards, including ‘Middle Eastern Private Equity Firm
of the Year’ from London-based Private Equity International four years in a row. Abraaj Capital Ltd. is licensed by
the Dubai Financial Services Authority, which operates according to international regulatory standards. The group
is an associate member of the European Venture Capital Association. Abraaj’s commitments to Corporate Social
Responsibility include a US$ 10 million educational trust fund for Palestinian children who lost parents during
conflict in Gaza in December 2008 and January 2009. The Abraaj Capital Art Prize, the world’s most generous
art prize, is designed to support artists from the MENASA region.
Disclaimer - “This document is issued by the Abraaj Capital group. It is intended for general information purposes only and does not constitute an offer or solicitation for any
business transaction. It is intended solely for the recipient to whom this document is directly issued by Abraaj Capital and may not be reproduced or redistributed in whole or in
part to any other person. Neither this document nor any copy hereof may be distributed in any jurisdiction where its distribution may be restricted by law. Persons who receive
this document should make themselves aware of, and adhere to, any such restrictions. By accepting this document, the recipient agrees to be bound by the foregoing limitations.
Abraaj Capital Limited, one of the member companies of the Abraaj group of companies, is regulated by the Dubai Financial Services Authority.”
“Unless otherwise stated, any reference to Abraaj or Abraaj Capital in this newsletter should be interpreted to mean the Abraaj Capital group. Abraaj Capital Limited (ACLD) is
regulated by the Dubai Financial Services Authority and is a member of the Abraaj Capital group. Further, the words “ownership by Abraaj”, means ownership by the Collective
Investment Funds that are managed by the Abraaj Capital group for its investors.
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Thought Leadership
Thought Leadership
Turkey; Ripe for Private Equity
as Economy Begins Recovery
By Selcuk Yorgancioglu, Turkey Country Head & Executive
Director, Abraaj Capital Limited
Turkey’s economy has taken a beating this year. Gross domestic product in the first half fell a
whopping 10.6 per cent. Unemployment is in double digits and government finances are in
deficit. By these measures, the year ahead looks challenging.
S
tatistics, however, are pliable. Facts are more
stubborn. Turkey’s economy, the fifth-biggest
among the world’s emerging markets, is on
the road to recovery and with it private equity
interest that started accelerating in 2006 but paused
a year ago as the global financial system went into
meltdown.
Turkey has all the ingredients, not only to attract as
much private equity capital as before, but even larger
amounts as we move into 2010 and beyond. The country’s
US$ 730 billion economy is the second-biggest in the
Middle East, North Africa and South Asia (MENASA),
and the eighth biggest in Europe. Its 72-million strong
population is the third-largest in Europe, the Middle
East, and North Africa (MENA), and growing at above
the global average. More than that, 45 per cent of the
population is under the age of 25, implying huge pentup demand for goods and services. Still, GDP per capita
is less than a third that of the European Union average. In
terms of development and wealth creation, Turkey clearly
has tremendous growth ahead of it.
The building blocks for growth are in place. Broad
economic and financial reforms implemented by the AKP
government following a financial crisis in 2001 pushed
inflation down, stabilised the Turkish lira and encouraged
significant foreign direct investment (FDI). GDP raced
ahead by an average 6 per cent per year from 2003 to
2008.
Until 2005, private equity activity was limited but it
started to grow as the Turkish market expanded. The first
foreign private-equity investment in a Turkish company
of more than US$ 100 million came with Providence’s
US$ 150 million acquisition of a 46 per cent stake in
4
is now a well-established emerging stock market. In
October, the market value of the ISE topped US$ 200
billion for the first time in more than a year, with average
daily trading volume at some US$ 1.1 billion year-todate. Foreign investors now own about 65 per cent of the
value of publicly listed Turkish companies, and enjoy the
same legal status as Turkish nationals, including the free
transfer of profits and repatriation of capital rights. The
attraction for private equity companies is the opportunity
ISE offers to exit investments.
Still, there are challenges for private equity in Turkey.
Post-acquisition involvement by the investor needs
to be more hands-on than perhaps in more developed
economies. As corporate governance needs further
improvement, investors have a role to play in guiding their
investments through the learning process of reporting,
budget adherence and cross-selling with sister firms.
Seller-price expectations also has to be managed.
The last six months have seen the availability of Turkish
bank financing for new transactions expand. While this is
clearly very helpful for private-equity investors looking at
fresh opportunities in Turkey, potential target companies
have emerged from the economic crisis stronger, with
their views on price relatively high.
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Digiturk, the country’s biggest pay TV platform. In the
same year Texas Pacific Group bought 90 per cent of
liquor manufacturer Mey Iç̇ki for US$ 810 million, and
Partners in Life Sciences and Citigroup Venture Capital
jointly acquired a majority stake in drug manufacturer
Biofarma Il̇aç for US$ 240 million.
Other large private equity deals followed with the
2007 purchase by an Abraaj fund of a 50 per cent stake
in Acibadem Healthcare Group, Turkey’s biggest privately
owned hospital operator. But the biggest buyout came
last year when BC Partners paid US$ 1.5 billion for a 51
per cent stake in Migros, Turkey’s largest food retailer.
Since then, there have been no major purchases, for
obvious reasons but a pick-up is imminent. Turkey has a
strong, credible and independent central bank, and wellfunctioning regulatory bodies such as the Competition
Board, the Energy Regulator and the Capital Markets
Board. A strong regulator can have an extraordinary
impact on an industry, in Turkey’s case most strikingly
on banking which went through significant reform after
2001 under the watchful eye of the Banking Regulation &
Supervision Agency.
Banking is very much a bright spot in the Turkish
economy with high capital-adequacy ratios, relatively few
non-performing loans, lower reliance on foreign-exchange
wholesale funding and no meaningful exposure to toxic
assets. The government’s focus on this key component
of the economy has had a very positive impact on the
industry, notably on its various performance ratios, and
the limited number of defaults by corporate and retail
clients.
The capital markets, too, are well developed. The
Istanbul Stock Exchange (ISE), which was set up in 1986,
5
Abraaj Buyout Fund (ABOF)
Abraaj Buyout Fund II (ABOF II)
JorAMCo Renews MRO Partnership
with Royal Jordanian
GMMOS Expands Offshore Supply
Vessel Fleet, Eyes Asia Growth
Jordan Aircraft Maintenance Company (JorAMCo), of which Abraaj owns 80 per cent, renewed its long-term technical
services agreement with national carrier Royal Jordanian to do heavy and basic maintenance on its growing fleet of
aircraft.
Stanford, the marine-charter unit of Gulf Marine Maintenance & Offshore Services Company (GMMOS), has taken
delivery of five more off-shore supply vessels (OSV), boosting its fleet to almost 30, and making it the biggest provider of
marine services to the offshore oil and gas industry in the Gulf, with clients like Abu Dhabi National Oil Company.
T
T
he agreement reinforces the partnership
between JorAMCo and Royal Jordanian amid
challenging times in the aviation industry. High
oil prices in the first half of 2008, followed by
global recession, have had an impact.
The industry is now marked by weaker demand,
fears over swine flu and lower consumer confidence,
with the result that aviation as a whole is likely to lose
money this year, according to the International Air Travel
Association.
Not immune to economic contraction, the global
maintenance, repair and overhaul (MRO) sector has faced
difficulties. Although the year will be challenging, the
longer term outlook remains positive as economies and
the air travel industry recover.
Royal Jordanian, a publicly listed company, operates
a fleet of 29 aircraft, most of them Airbus. In 2008, the
airline, which is certified among others by the US Federal
Aviation Administration and the European Aviation
Safety Agency, carried 2.7 million passengers to some 56
destinations.
JorAMCo specialises in a range of Airbus aircraft,
including the A330 and A340, as well as Boeing 727s and
737s, the Embraer 170 and 195, and the Lockheed L-1011
TriStar. Royal Jordanian operates Embraer and one cargo
6
Boeing 737.
Capabilities include heavy maintenance, repairs,
ageing-aircraft inspection and modification, corrosion
control and protection, avionics modifications and
cabin refurbishment. To maintain the skills of JorAMCo’s
workforce and encourage their development, the company
is working on developing its own academy in association
with Air Service Training in Perth, Scotland.
JorAMCo started operations as Royal Jordanian’s
maintenance and engineering department in 1963.
After a government decision to privatise and restructure
the airline, JorAMCo was launched as an independent
company in 2000, offering a range of MRO services for
Airbus, Boeing and Lockheed aircraft.
It won several contracts with airlines around the world,
leading to the company being offered for privatisation in
2005 through an international tender.
wo of the vessels were bought, while the other
three were ordered from GMMOS’s shipbuilding
and repair unit, Grandweld. Petroleum companies
typically charter these vessels for as many as two
years, and use them to ferry equipment and people to rigs
in the Gulf.
Capitalising on years of experience in the Gulf,
Stanford, with support from Abraaj, is looking to expand
to other parts of the world, notably South-east Asia and
West Africa, by acquiring additional vessels and other
marine-charter providers. The company is in talks with
banks about providing funding for the plans.
Grandweld’s ship-repair operations are above
budget and likely to grow further as it starts work at new
berthing facilities at Dubai Maritime City. Meanwhile,
the shipbuilding business expects to secure fresh orders
in North Africa against stiff competition from wellestablished players in Europe. The orders could keep the
yard in Jadaf on Dubai’s Creek fully occupied for the next
two years.
Gallagher, GMMOS’s crane-rental unit, is working at
80 per cent capacity despite the slowdown in the United
Arab Emirates property sector and is in the process of
setting up operations in Abu Dhabi, where construction
is moving ahead.
Key Facts
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T
R
A
CEO
Fund Ownership:
100 per cent including co-investors
Date of Purchase:
2007
Key Facts
Fund Ownership:
80 per cent
Date of Investment:
2005
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Abraaj Buyout Fund II (ABOF II)
Abraaj Buyout Fund II (ABOF II)
ART Marine, Middle East’s Biggest
Yacht Dealer, Appoints CEO
ART Marine, the Middle East’s biggest importer and distributor of luxury motor-yachts, announced the appointment of
a highly experienced CEO from the United States to drive its expansion in the region as demand for pleasure craft begins
to recover.
D
emonstrating the Gulf’s continued ability to
attract some of the world’s most talented
professionals, Constantinos Constantinou
joins ART Marine from Cobalt Yachts in
Tennessee, where he served as President.
Mr. Constantinou began his career in Cyprus with
Cobra Marine Services. In 1995, he joined the Sea Ray
division of Brunswick Corp., the U.S.’s biggest marine
manufacturer. There, he served as Senior Vice President
for Strategic Alliances & International Operations. He
joined Cobalt Yachts in 2005.
“Constantinos’ broad marine operations expertise,
combined with his 20 years in various high-level positions
in the marine industry, will make a significant contribution
to ART Marine and its customers,” said Alessio Tumbiolo,
Chairman and co-founder of ART Marine.
Key Facts
Fund Ownership:
90 per cent
Awards:
‘Best Sales & After-Sales
Dealership’
‘Best Charter Company’
ART Marine, the region’s exclusive dealer for Benetti,
Azimut, Atlantis and Riviera yachts, has been expanding
across the Middle East with operations in five countries,
including the UAE, Bahrain, Kuwait, Qatar and Egypt.
The firm is the only yacht dealer in the region offering
extensive after-sales services.
Demand for luxury yachts in the Middle East has
exploded over the last 10 years, driven by increased
wealth generation and the development of marinas in the
Gulf and Red Sea.
“I’m excited to join ART Marine and to be leading
8
such a high-calibre team. The Gulf region is one of the
most promising markets globally, and the affinity for
pleasure boating and yachting is increasing steadily,” Mr.
Constantinou said.
“We are introducing new standards by implementing a
360-degree marine hospitality strategy that encompasses
a wide array of services such as sales, maintenance, aftersales support, chartering, brokerage, yacht management,
and marina management and operations. I look forward
to contributing towards the remarkable growth of ART
Marine as we expand our range of products and services
to all regional markets.”
ART Marine was founded in 2005 to offer world-class
marine services, including the sale of quality yachts,
maintenance, after-sales support, yacht management,
charter and marina management in the Gulf region.
Through an exclusive agreement with Dubai’s
Jumeirah Beach Hotel, ART Marine Charter Division has
been successfully operating since 2006, offering charter
packages such as romantic dinners, corporate lunches,
team-building trips, sight-seeing trips to the Jumeirah
Palm, the World islands and other destinations.
9
Infrastructure & Growth Capital Fund (IGCF)
Infrastructure & Growth Capital Fund (IGCF)
Karachi Electric Supply Company
Appoints New CEO
The board of Karachi Electric Supply Company (KESC) appointed Abraaj Capital Limited Executive Director Tabish Gauhar
as Chief Executive Officer as part of the long-term plan to turn around the city’s monopoly power provider and meet
public needs in an area vital to Karachi’s economic well-being.
M
r. Gauhar replaces Naveed Ismail as CEO,
who led the new management team
that took control in 2008. As Managing
Director of KESC’s holding company, KES
Power, Mr. Ismail is now managing KESC’s key strategic
relationships. This includes deepening relations with the
government of Pakistan and other stakeholders.
It has been more than a year since Abraaj deployed
fresh management to run KESC. Turning the company
around is a major challenge. For years, it suffered from
underinvestment, ageing equipment and low employee
morale.
Since 2008, several major improvements have been
made. Dependable power-generating capacity is up at
least 10 per cent at more than 1,500 megawatts (mw).
Another 450 mw has come on-stream during 2009,
helping plug some of the gaps that have led to a demandsupply gap in Pakistan’s industrial hub, compounded by a
rapidly growing population.
KESC is also building a 560 mw gas-powered station
that is due to become fully operational in 2012 and will
break ground at four other sites through Feburary. In all, it
plans to add more than 1,000 mw of capacity to the city’s
grid within three years.
Abraaj, which owns 35.8 per cent of KESC, has also
fast-tracked the construction of 12 new grid stations,
a project that was consistently delayed under previous
owners. Four of the stations are now operational and
another four are expected to come on-stream soon,
helping regenerate KESC’s ageing transmission and
distribution system.
KESC is one of the few remaining fully integrated
power providers in Asia, offering power-generating,
transmission and distribution capacity. To boost its
distribution service, KESC has set up Integrated Business
Centres (IBCs) in the city, which has seen cash collections
rise almost 80 per cent.
Abraaj’s engagement with the government has been
crucial. Since taking control of KESC, Abraaj has secured
government guarantees to provide 650 mw to Karachi to
cover any shortfall in supply. It is also working to eliminate
a US$ 325 million contingent liability to the government.
These are funds nominally owed to the government for
power provided that should be offset by payments due
from public sector institutions.
The improvements have seen revenue at the publicly
listed company rise 27 per cent to more than 85.2
billion rupees (US$ 1 billion) in the year to June 30,
driven by higher sales and additional subsidies from the
government.
Total Commitment:
US$ 361 million
Total Invested by the Fund to Date:
$163 million
Fund Ownership:
35.8 per cent
Total Revenue (Year to June 30):
US$ 1.02 billion
Though net losses for the fiscal year were just under
16 billion rupees, the results are significantly better than
in the year earlier, and will improve further as collections
rise and line losses are reduced.
The turnaround process will require much energy and
investment. Abraaj alone has seconded at least nine staff
to KESC to help overhaul the company’s organisation
structure and human resources policies.
About Tabish Gauhar
Tabish Gauhar has more than 16 years of project
finance, business development and general
management experience in the private power, water
and petrochemical industries in the
Middle East, South Asia, Europe and
Africa.
He led Abraaj’s management
team in buying a stake in and
acquiring management control of
Karachi Electric Supply Company
(KESC) in 2008. He currently serves
as CEO of KESC, as well as being a
member of its Board and Executive
Committee. KESC is Pakistan’s
biggest electricity utility and one
of the world’s few remaining fully
integrated power companies, with
a turnover of US$1 billion.
Before joining Abraaj in 2006, Mr. Gauhar was the
regional chief financial officer of AES Corporation,
responsible for a power and water portfolio spanning
16 businesses and 12 countries in Europe, the Middle
East and Africa, worth US$ 5 billion.
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Key Facts
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His key achievements at AES included closing two
independent water and power projects in the Gulf
worth US$ 1.2 billion, six project finance deals of US$
1.3 billion of non-recourse debt,
and successful initial public offering
of sponsors’ shares in Oman.
Between 1994 and 1999, Mr.
Gauhar worked on International
Power’s US$ 1.5 billion Hub Power
Project in Pakistan in various
capacities across the development,
financing,
construction
and
operational phases of the project.
He also served as deputy treasurer
at HubCo.
Mr. Gauhar started his
career at an Exxon Chemical in 1993
as a systems analyst. He holds a first-class honours
degree in Electrical Engineering from King’s College,
London (ICI/Chevening Scholar), and an MBA
in Finance from the Pakistan Institute of Business
Administration.
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Infrastructure & Growth Capital Fund (IGCF)
Infrastructure & Growth Capital Fund (IGCF)
Turkey’s Acibadem Shows Resilience
as Healthcare Needs Grow
2009 has been a tough year for the Turkish economy. Through this, however, Acibadem, Turkey’s biggest privately owned
hospital operator, has shown resilience.
T
hrough the Funds it manages for its investors,
Abraaj owns 46 per cent of Acibadem Healthcare,
and 50 per cent of each of Acibadem Insurance;
APlus, a healthcare facilities management firm;
and Acibadem Project Management, a healthcare project
management company.
Though in-patient numbers at Acibadem Healthcare
rose almost 11 per cent in the six months to June 30,
revenue declined in dollar terms because of a fall in the
value of the Turkish lira.
Turkey was hit in late 2008 and early in 2009 by the
global financial and economic crisis but has since joined
the road to recovery. The outlook is good as undersupply
persists in key sectors such as healthcare and education
in the emerging market.
Acibadem Healthcare is continuing with its expansion
plans across Turkey, adding two hospitals to its network
of nine before the end of 2010, giving it a footprint in
seven major cities in Turkey.
The firm, which was founded in 1991, opened three
hospitals in 2009, boosting the number of hospital beds
by 60 per cent to almost 1,200. Though the opening of
the hospitals added to costs, earnings before interest,
taxes, depreciation and amortisation (EBITDA) still rose
34.3 per cent in the first half in Turkish lira terms.
The number of out-patients also grew at 4.4 per cent
to 774,832, though the growth was slower than before as
the economic downturn and new regulations impacted
negatively on premium hospital operators. The number
of insured employees declined because of lay-offs in
the economy and as the government fixed new pricelimitations for public-sector patients.
In a move that is likely to generate more business for
its hospitals in Istanbul and Kocaeli, Acibadem signed a
cooperation agreement with Dutch insurance company
Achmea/Aegis. In addition, Acibadem University, a facility
funded by Acibadem Group founder and CEO Mehmet
Ali Aylinder, started accepting students in 2009, giving
Acibadem Healthcare a steady flow of medical talent.
12
With support from Abraaj, Acibadem is looking
at several acquisition and management contract
opportunities in countries in the Middle East, North
Africa and South Asia (MENASA), notably Saudi Arabia
and Egypt.
For Acibadem Insurance, one of the country’s largest
health insurance providers, 2009 has been a year of
consolidation after several of expansion. More than
anything, the slowing economy, as well as other factors
such as pressures on price and increased competition, has
affected the industry.
Still, in the first half, Acibadem Insurance was ahead of
budget on gross written premiums after adding accounts.
It maintains its 8 per cent share of the market.
GEMS Dubai Student Numbers Hold
Up Despite Expat Leaver Concern
2009 has been an important year for GEMS, the Middle East’s biggest privately owned school operator, of which
Abraaj owns 25 per cent. There has been much talk about people leaving Dubai, where GEMS is based, because of the
economic crisis.
Y
Key Facts
Out-Patients (1st Half):
774,832
Number of Hospital
Beds:
1,166
Growth in EBITDA:
34.3 per cent
Number of Hospitals:
9
et, at September 30, the end of GEMS’s second
fiscal quarter and the first month of the
2009/2010 academic year, student enrolment
at its network of 53 schools rose compared with
a year earlier, reaching more than 80,000 students.
GEMS, which has almost 50 years of experience
in operating schools, also secured three management
contracts in India and went on to finalise the acquisition
of five acres of land to build its first flagship international
curriculum school in the country.
GEMS is unique in that it offers a wide range of
curricula including Arabic, British, American, International
Baccalaureate and Indian, to meet the needs of kids in
the Middle East, North Africa and South Asia (MENASA),
a region characterised by huge demographic and cultural
diversity.
The firm, which employs 7,000 staff from over 50
nationalities, is capitalising on its international expertise
to expand its network.
In 2009, it agreed to manage a top private school in
Jeddah, Saudi Arabia’s second-largest city, and is also
in discussions to acquire a school in the kingdom. In
addition, GEMS is in advanced talks to make acquisitions
in Egypt and Turkey, the two most populous nations in
the Middle East.
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Key Facts
Fund Ownership:
Date of Acquisition:
Years of Experience:
Number of Students:
Number of Staff:
Number of Schools:
25 per cent
48
7,000
2007
80,034
53
13
Infrastructure & Growth Capital Fund (IGCF)
Infrastructure & Growth Capital Fund (IGCF)
Bosicor Petrochemical Plant Due Mid2010, Italy Facility Plant Dismantled
Al Borg Expands Lab Network in
Egypt, Eyes Partnerships
Pakistan’s Bosicor is on track to become the country’s biggest player in the oil refining and petrochemical industry.
The completion of a Bosicor storage facility already makes it the country’s second-largest crude and finished-product
storage firm.
Al Borg Laboratories, the Middle East’s biggest medical-testing laboratory company, is accelerating its expansion across
Egypt, and is assessing several partnership and acquisition opportunities in the Middle East, North Africa and South
Asia (MENASA). It also hired a chief financial officer (see box) and business development head to strengthen its senior
management, bolster its corporate governance and underpin its regional growth efforts.
Key Facts
Date of Acquisition:
2008
Fund Ownership:
40 per cent
Amount Invested:
US$ 131.1 million
I
n all, Cairo-based Al Borg, of which Abraaj effectively
owns 80.2 per cent, is set to add 12 branches in Egypt
in 2009, taking the total to more than 70. Five had
already been opened by the end of June, benefiting
from a cool-down in the property market from the peak
in 2008.
On average, Al Borg is opening a branch every month
and has implemented various partnership agreements,
notably with a global pharmaceutical company to provide
vaccinations through Al Borg outlets. It is also considering
a water-testing joint venture targeting industrial and
tourism clients.
The planned acquisition of a leading genetic-testing
lab is also well advanced. Though relatively small, genetic
diagnosis is a fast-growing market with significant
potential and will bolster Al Borg’s diagnostic menu.
Other initiatives are also underway, including a comarketing arrangement with the largest pharmacy chain
in Egypt and an obesity-screening programme in what is a
high-margin market. A new logo has been adopted which
is more modern and reflects Al Borg’s dynamic growth.
Al Borg has successfully integrated the Molecular
Biology Centre, an acquisition it made earlier in 2009
that immediately helped boost margin growth. Revenue
in the first half rose 13 per cent, also driven by a rise in the
number of tests and higher revenue per tests.
Net income also climbed, in part because of a onetime gain from the sale of Al Borg’s 10 per cent stake in
Mokhtabarat Al Borg in Saudi Arabia, which will facilitate
its unencumbered expansion into the Kingdom and
elsewhere in the Gulf.
Further afield, Al Borg is looking at a potential
acquisition in India, the world’s second-most populous
nation, and is exploring opportunities to enter Saudi
Arabia, Libya and Pakistan. The company has reached
initial agreement to manage the laboratory department
of a new hospital in the Kurdish province of Iraq.
Sherif Shaheen Joins Al Borg as CFO
B
osicor Oil Pakistan Limited (BOPL), a unit of
Bosicor, is building the country’s largest crude
oil refinery with a capacity of 115,000 barrels
per day (bpd).
To this end, an existing refinery in Britain was
dismantled and transported to Pakistan, and is being
refurbished and re-erected on-site. Commercial
operations are expected to begin in mid-2010.
BOPL is also in talks with Scotland’s Aggreko to
provide temporary power to start up the refinery, whilst
simultaneously considering a longer-term solution.
Bosicor Chemicals Pakistan Limited (BCPL), another
unit, has completed dismantling a chemical plant in
14
Naples, Italy. The plan is to re-erect the 17,000 bpd plant
in Pakistan. The Italian government has given approval to
export the plant and equipment is arriving in Karachi.
Completion of the plant is now due for the end of
2010. By sourcing feedstock from the BOPL facility rather
than other providers, the plant will benefit from lower
input costs, improving its economics.
Abraaj has also launched a mandatory tender offer
for about 35 per cent of the shares in Bosicor Pakistan
Limited (BPL), which operates a 30,000 bpd refinery and
an oil marketing unit. BPL also manages 50 branded fuel
stations, with another 50 planned across the country.
Sherif Shaheen joins Al Borg Laboratories as Chief
Financial Officer. He has more than 20 years of
experience in finance, management,
auditing and turnaround. After graduating
from the American University in Cairo with a
BA in Business Administration, Mr. Shaheen
began his career in banking, working at both
National Société Generale Bank and Misr
International Bank in Egypt. He then moved
to be an auditor at PricewaterhouseCoopers
in Qatar, working on the financials of the
state-owned oil company.
In 1992, he joined Arthur Andersen and was deeply
involved in the first wave of privatisation of Egyptian
companies. In 1994, he moved to the Egyptian
Developed Food Industries Plc, where he was CFO
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Si
and quality representative, updating the company’s
policies and procedures, and preparing financial
statements. He moved into private equity
in 1998, working for Concord International
Investments, a New York-based asset
management company with almost US$ 3
billion of funds under management in the
United States, Egypt and Japan.
Mr. Shaheen sat on the boards of
the United Milling Company and the
Growth Coral Fund, the latter a Guernseybased private equity fund dedicated
to investments in Egypt. Before joining Al Borg,
Mr. Shaheen served as Managing Director for
Finance and IT at Egyptian Company for
Food (BiscoMisr).
15
Abraaj Capital Limited
Abraaj Capital Limited
Abraaj Appoints Industry
Veteran Waqar Siddique as
Managing Director
Abraaj Capital Limited appointed industry veteran Waqar Siddique as a managing
director as the group accelerates its programme to build institutional capacity and
embed experience. Mr. Siddique joins Mustafa Abdel-Wadood and Ashok Aram in the
ranks. Mr. Aram came to Abraaj from Deutsche Bank earlier in 2009.
M
r. Siddique is a member of the Board
of Directors of Abraaj Capital Holdings
Limited. He specialises in strategic
business development, operations and risk
management in the Middle East and South Asia.
In his capacity as CEO of Abraaj Managers Limited,
Mr. Siddique is responsible for overseeing Abraaj’s postacquisition investment activities. He leads a team of
senior operating professionals that focuses on managing
and creating value in portfolio companies spread across
12 countries in the MENASA region. He also represents
Abraaj on the board of several companies, including as
chairman at Karachi Electric Supply Company (KESC),
Jordan Aircraft Maintenance Limited (JorAMCo) and Gulf
Marine and Maintenance Offshore Company (GMMOS).
of Cupola Group. In 1999, he was one of the senior
directors who concluded the landmark private equity
deal of acquiring Inchcape interests in the Middle
East by Cupola. He was extensively involved and
spearheaded many subsequent divestments of the assets
acquired by Cupola.
Previously, Mr. Siddique worked for Mawarid Holding
Company, a leading business conglomerate based in
Riyadh. Before that, he was a senior consultant with
PricewaterhouseCoopers in Pakistan. Mr. Siddique is
married with two children. He started his career in 1982
and holds a Masters in Business Administration.
Abraaj Wins Awards, Including
Corporate Social Responsibility
Abraaj is proud to have won two awards over the last few months, notably in Corporate Social Responsibility. The
other award was as ‘Private Equity Company of the Year’ from Paris-listed business-information group Naseba at an
investment forum in Saudi Arabia.
N
ow in its second year, the CSR Arabia Award
is an initiative of the Emirates Environmental
Group, and is open to companies in the
Middle East to recognise clear vision, strategy
and implementation of CSR programmes. There were over
60 applicants.
With more than 60 questions covering governance,
employee and stakeholder engagement, environmental
policy, community service and philanthropy, the awardentry process is designed to examine thoroughly company
policies and implementation.
Winning the award speaks to Abraaj’s pioneering
efforts in CSR by a regional private equity company and to
its long-standing commitment to various programmes.
Abraaj believes CSR plays a vital role in the economic
and social welfare of the Middle East, North Africa and
South Asia (MENASA). It was the first private-sector
company in the MENA region to sign the United Nations
Principles for Responsible Investments (UNPRI). The
company has long funded its Community Partnership
Programme with 5 per cent of the group’s management
fees, and through employee donations, to support
educational, medical and social needs of children in the
MENASA region.
More than 50 projects have been funded since 2007,
including the US$ 10 million Abraaj Capital Gaza Children
& Youth Trust.
Abraaj investment professionals also work with the
Acumen Fund on a pro-bono advisory basis to help build
capacity in their investee companies, providing affordable
services in education, housing and healthcare to very low
income communities in the region.
t:
Nex
aj Art
Abra
Prize
Board of Directors
Mr. Siddique also joined the Board of Directors
of Abraaj Capital Holdings Limited. Two other
appointees to the board are Managing Director Ashok
Aram, who served previously as a representative of
shareholder Deutsche Bank, and Abraaj Executive
Director Tom Speechley. Mr. Aram joined Abraaj
during 2009. The three join Abraaj CEO Arif Naqvi
and Managing Director Mustafa Abdel-Wadood
on the board.
Mr. Siddique also serves as a member of the
Board of Governors of Karachi’s Institute of Business
Administration, the oldest business school outside
North America. And he is a trustee of the AMAN
Foundation in Pakistan.
Prior to joining Abraaj, Mr. Siddique was the CEO
16
17
Abraaj Capital Art Prize
Abraaj Capital Art Prize
Announces 2010 Winners
Established to raise awareness of the under-represented work being created by artists from the Middle East, North
Africa and South Asia (MENASA) region, the coveted Abraaj Capital Art Prize, now in its second year, announced three
winning teams of artists and curators for the 2010 prize.
T
his year’s prize recipients, artist Hala Elkoussy and
curator Jelle Bouwhuis; artist Marwan Sahmarani
and curator Mahita El Bacha Urieta; and artist
Kader Attia and curator Laurie Ann Farrell, were
all honoured as part of an event held during a visit to
Dubai that enabled the winning teams to view the city in
which the works will be unveiled.
(see box)
They have six months to complete their artworks
which will be unveiled in March during the Art Dubai
fair, before they become part of the Abraaj Capital Art
Collection.
Speaking at the event, Frederic Sicre, Executive
Director of Abraaj Capital, commented: “In its second
year, the Abraaj Capital Art Prize signifies not only
our continued commitment to supporting the creative
potential to be found in the MENASA region, but also
reinforces Abraaj Capital’s unwavering commitment as a
patron of the arts. Our aim is to empower young artists
across the MENASA markets and bring their talents to
the forefront of both the regional and international art
community.”
Savita Apte, Chair of the Abraaj Capital Art Prize,
18
said: “The quality of applications that we received this
year indicates a significantly higher level of interest,
understanding and maturity. We are thrilled with the
high calibre of established artists and curators vying for
the Abraaj Capital Art Prize. There will be both a regional
and global audience keen to see each of these artist’s
creations at Art Dubai 2010.”
Upon receiving their awards, each artistcurator team expressed their excitement and their
ambition to make the most of the endorsement
by the Abraaj Capital Art Prize committee.
Kader Attia, an Algerian, expressed his
appreciation: “To win this award means a lot to
me, especially with the new artwork I propose.
To win the award is, for me, the sign of an echo,
of what I wanted and aimed to tell with my
proposal.”
Hala Elkoussy, a native of Cairo and cofounder of the Contemporary Image Collective
-- an artist-run initiative dedicated to the visual
image -- commented: “I am honoured to be
the winner of the Abraaj Capital Art Prize. I am
extremely pleased that such great opportunities
are becoming available to artists from the
region.”
Marwan Sahmarani, from Lebanon, creates artwork
deeply rooted in his Middle Eastern origins: “It is an
opportunity for me to share my work with the Arab
contemporary art community and to reach out to a
broader audience. In receiving this honour, I am ‘seen’ by
my peers as an innovative voice in the Arab art world.”
Acibadem Healthcare Group, Turkey،
www.acibademhastanesi.com.tr/English/
Air Arabia, UAE
www.airarabia.com
Emirates Heights Development Company
UAE
GMMOS, UAE
www.gmmosgroup.com
Al Borg Laboratory, Egypt
www.alborglab.com
GEMS, UAE
www.gemseducation.com
Artist: Hala Elkoussy (Egypt), 3rd from left
Curator: Jelle Bouwhuis (Netherlands), far left
Osian’s, India
www.osians.com
Orascom Construction
Industries, Egypt
www.orascomci.com
ART Marine, UAE
www.artmarine.net
JorAMCo, Jordan
www.joramco.com.jo
Ramky Group, India
www.ramky.com
BMA Capital, Pakistan
www.bmacapital.com
Karachi Electric Supply
Company, Pakistan
www.kesc.com.pk
Bosicor Group, Pakistan
www.bosicor.com.pk
Man Infraconstruction
Limited, India
www.maninfra.com
Dead Sea Co. for Conferences
& Exhibitions, Jordan
www.dscc.jo
Signature Clubs International, UAE
www.signatureclubs.com
Spinneys Holdings Limited,
Egypt, Lebanon
www.spinneys.com
Seraii Hospitality, UAE
www.seraiihospitality.com
Mannan Shahid Forgings
Limited, Pakistan
www.msforgings.com
ECI Engineering & Construction Co. Ltd
India
www.eciecc.com
Tadawi, Saudi Arabia
www.tadawigroup.com
Artist: Kader Attia (Algeria), absent
Curator: Laurie Ann Farrell (United States), far right
Artist: Marwan Sahmarani (Lebanon), 2nd from right
Curator: Mahita El Bacha Urieta (Spain), 3rd from right
Numarine, Turkey
www.numarine.com
Mediaquest CORP., UAE
www.mediaquestcorp.com
Enshaa, UAE
www.enshaa.ae
19
Turkey
Abraaj Investment Management Ltd.
Saudi Arabia
Abraaj Saudi Arabia Ltd.
Abraaj Investment Management Ltd., Türkiye Irtibat Bürosu
Vişnezade Mahallesi, Süleyman Seba Cad. No: 32/2
Beşiktaş, Istanbul 34357, Turkey
T: +90 212 381 4800
F: +90 212 381 4810
Abraaj Saudi Arabia Ltd., Kingdom Tower, 25th Floor
PO Box 301052, Riyadh, 11372
Kingdom of Saudi Arabia
T: +966 1 211 3044
F: +966 1 211 3043
Beliz Geçginer, Personal Assistant
T: +90 212 381 4800
beliz.gecginer@abraaj.com
Jason Sikat, Personal Assistant
D: +966 1 211 3044
jason.sikat@abraaj.com
United Arab Emirates
Abraaj Capital Ltd.
Dubai International Financial Centre, Gate Village 8, 3rd Floor
PO Box 504905, Dubai, United Arab Emirates
T: +971 4 506 4400
F: +971 4 506 4600
James Cordahi, Senior Vice President
D: +971 4 506 4644
james.cordahi@abraaj.com
Egypt
Abraaj Capital Ltd.
Pakistan
Abraaj Capital Ltd.
Nile City Towers, North Tower, 17th Floor
Corniche El Nil, Ramlet Beaulac, Cairo, Egypt
T: +20 2 2461 9930
F: +20 2 2461 9931
Dolmen City, Executive Tower, 6th Floor, Office 6A,
Clifton, Block 4, Karachi, 75600 , Pakistan
T: +92 21 3529 7556-60
F: +92 21 3529 7549
Rasha Makkawi, Personal Assistant
T: +20 2 2461 9930; Ext 110
rasha.makkawi@abraaj.com
Anna Hakels, Personal Assistant
T: +92 21 3529 7556-60; Ext 121
anna.hakels@abraaj.com
info@abraaj.com, www.abraaj.com
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