News

26 March 2018

Global concludes exit from Jazeera Steel, a listed company on Muscat Securities Market

Advised by the Investment Banking team, the alternative asset management arm, Global Capital Management (“GCM”), concluded a successful exit of its controlling stake in Al Jazeera Steel Products Company (“Jazeera Steel”), a Omani company listed on Muscat Securities Market.

The transaction was concluded on Sunday 25 March 2018 and the full ownership held through GCM’s managed fund, Global Buyout Fund, was transferred to the acquirers Sheikh Suhail Bahwan and Sheikha Amal Suhail Bahwan, Chairman & Vice Chairperson of Suhail Bahwan Group, respectively. The Investment Banking team at Global was the sell-side advisors to the Fund in this Merger & Acquisition transaction.

 

Sulaiman Mohammed Al-Rubaie, Deputy CEO of Global Investment House and Managing Partner of GCM commented on this exit: "We are extremely delighted to have completed this exit and provide our investors with liquidity in such challenging geopolitical and economic environment. We expect to distribute the proceeds from this transaction to clients investing in the Fund within the second quarter of 2018".

 

The fund acquired 51% stake of Jazeera Steel in 2007 and the management team of GCM implemented a growth program for the company. The program focused on enhancing its penetration in regional and international markets namely Saudi Arabia and North America, diversifying its product offerings by developing new product lines, strengthening the balance sheet and improving the corporate governance structure.

 

During the past five years, Jazeera Steel managed to maintain its growth trajectory despite tough financial and economic times, thanks to the robust strategy and management team. The company has reported significant achievements including an increase of 35% in total volume of products delivered, maintaining an efficient purchasing and inventory management and reporting steady financial performance with good dividends yield which resulted in its inclusion in MSM30 index.

 

Al-Rubaie added: "We are confident that the commitment, track record and expertise of the acquirers will provide Jazeera Steel with the required support and guidance to further grow the company. The strong financial and competitive position in addition to the solid foundation for future growth made Jazeera Steel an ideal target. Over the years, the private equity team has demonstrated its capabilities in managing, growing and exiting assets across diverse sectors and in challenging market conditions”.

 

M. Sherif El-Rafie, CFA, Head of Investment Banking at Global commented: “We are proud to have successfully concluded this M&A transaction efficiently and in a short period. This could not have been completed without the full support from all related parties including the sellers, buyers, management and regulators. This is a testament to Global’s IB ability to effectively manage cross border M&A, which is one of the key and unique abilities among Kuwaiti and regional investment banks”.

 

Al-Rubaie concluded by thanking the Omani government for all the support extended to the industrial sector, foreign investors and to Jazeera Steel in all fronts. 

 

It is worth noting that since the new management of the private equity team took over in 2010, the team has successfully restructured the portfolio companies, put them on the growth path and enhanced their value. Till date, the team has also concluded 33 exits, the highest among all private equity firms in the region, and distributed more than USD 360 million to its clients, raising the total distributions since inception to more than USD 580 million.

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