Interview: Mahmood Hashim Al Kooheji
What are some of Mumtalakat’s key highlights from the 2013 trading year?
MAHMOOD HASHIM AL KOOHEJI: We saw a positive trend in our financial results for 2013, recording net profits of BD82.7m ($219.16m) compared to a loss of BD181.7m ($481.51m) in 2012. These positive results can be attributed to the implementation of our investment strategy throughout the year.
Firstly, we grew our existing portfolio. We made considerable progress in completing the restructuring at Gulf Air. This was challenging and tough at times; however, we have accomplished a lot and have already begun to see positive outcomes on a variety of levels. The numbers speak for themselves; the 2013 annual results indicate that year-on-year the airline has reduced its overall losses.
We also invested in the Bahrain International Circuit (BIC) F1 arena to implement a significant upgrade to the facility. Over the past 10 years BIC has had a major impact on the Bahraini economy, generating a gross direct impact of more than $1bn and a total gross economic impact of more than $2bn.
In the real estate sector, we looked at various local projects on a case-by-case basis to ascertain their viability from a commercial perspective. On the downstream front we have signed several agreements with global players in the sector in anticipation of the Aluminium Bahrain Line 6 expansion, and are waiting for the imminent completion of the feasibility study. Additionally, we placed a lot of emphasis on enhancing and establishing stronger corporate governance procedures through a number of initiatives.
How are investment strategies changing?
AL KOOHEJI: Our outlook for 2014 is positive; we are well positioned in terms of liquidity and capital structure. We have focused our investment platform around two key economic clusters: firstly, industry, including the metals, aviation, food, health care and manufacturing sectors; and secondly, the services industry, including the financial services, technology, media and telecommunications, tourism and events, and real estate sectors. We choose to focus our efforts on local and international investment opportunities in the sectors where we have experience and leverage through our portfolio, specifically in the local market. Real estate remains a key target sector locally, and we are working on two major projects: the Durrat Al Bahrain and Hawar Island developments. In addition to continuing with the opportunities that were identified in 2013 across our sectors of interest, we are also looking into tourism and aluminium down-streaming in particular.
Our international investment focus is to pursue opportunities that are within the strategically targeted industry sectors that build on Bahrain’s strengths and the expertise of our investment team, and create greater synergies in our portfolio. In terms of international investment opportunities, we seek to align ourselves with strong partners that provide complementary skills, resources and perspective. We typically aim to be a significant minority investor, providing growth capital for global investors with strong track records. We are always exploring international investment opportunities that have the potential to create or enhance the value of our portfolio.
We tend to consider those opportunities that come up in the more stable markets of Europe, the UK and the US, where we continue to find good opportunities across the kinds of industries that will help us to further enhance synergies within our portfolio. We also consider opportunities in markets where we see continuous growth in our key sectors of interest – such as the Asian markets.
We need to grow, and to grow we must seize opportunities regardless of their geographic location. We are open to investments, as long as they satisfy our three key criteria: they have to be commercially viable, with high levels of corporate governance and strong transparency. These are our core partnership policies.
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