Abu Dhabi investment firms Gulf Capital and Waha Capital ‘holding merger talks’

Abu Dhabi’s state fund Mubadala has a minority stake in Waha Capital and Abu Dhabi Investment Council (ADIC), a unit of Mubadala, is a shareholder in Gulf Capital. (Reuters)
Updated 08 May 2019

Abu Dhabi investment firms Gulf Capital and Waha Capital ‘holding merger talks’

  • Private equity firm Gulf Capital manages over $4 billion in assets
  • Waha Capital’s total assets stood at $3.18 billion at the end of last year

DUBAI: Abu Dhabi investment firms Gulf Capital and Waha Capital have held exploratory discussions regarding a merger, according to three sources familiar with the matter.
The talks have taken place over several months and may or may not lead to a deal, the sources said.
Private equity firm Gulf Capital manages over $4 billion in assets. Waha Capital’s total assets stood at $3.18 billion at the end of last year. It also managed funds of $700 million.
Waha Capital’s portfolio of investments includes stakes in aviation leasing firm AerCap Holdings, a major Middle East and North African oil and gas services provider, and industrial real estate.
Abu Dhabi’s state fund Mubadala has a minority stake in Waha Capital and Abu Dhabi Investment Council (ADIC), a unit of Mubadala, is a shareholder in Gulf Capital.
Lower oil prices and government spending have spurred mergers and acquisitions in Abu Dhabi.
Waha Capital and Mubadala Investment Company declined to comment. Gulf Capital did not respond to an email seeking information.
Shareholders of Gulf Capital were pushing for a possible merger with Waha, said the sources, declining to be named due to commercial sensitivities.
Gulf Capital has been under pressure from ADIC and from Abu Dhabi Commercial Bank (ADCB), which also has a stake in Gulf Capital and a board seat, to seal deals, the sources said. ADCB declined to comment.
There are some other shareholders who also want a merger, they said. One of the sources said there could be some clarity about the merger plans by June.
However, the prospects for a deal are unclear following the appointment in March of Waleed Ahmed Al Mokarrab Al-Muhairi as chairman of Waha.
Al-Muhairi, who is also deputy group chief executive at Mubadala, is drawing up a strategy for Waha, one of the sources said.
It is unclear whether a merger might be part of that strategy, which should be presented to the board shortly, the source said.
Transactions in Abu Dhabi have picked up since two lenders combined to create First Abu Dhabi Bank in 2017. ADCB merged with two other lenders last week to create a bank with 423 billion dirhams ($115 billion) in assets, the third biggest in the UAE.
The talks also come amid some wariness among investors toward the private equity industry in the Middle East since the collapse of Dubai-based Abraaj Group last year.
Waha Capital abandoned plans to raise a $300 million private equity fund and is pushing ahead with a new strategy for its private equity business, it was reported in June.


Africa development bank says risks to continent’s growth ‘increasing by the day’

Updated 18 August 2019

Africa development bank says risks to continent’s growth ‘increasing by the day’

  • The trade dispute between US and China has roiled global markets and unnerved investors
  • African nations need to boost trade with each other to cushion the impact of external shocks

DAR ES SALAAM: The US-China trade war and uncertainty over Brexit pose risks to Africa’s economic prospects that are “increasing by the day,” the head of the African Development Bank (AfDB) told Reuters.
The trade dispute between the world’s two largest economies has roiled global markets and unnerved investors as it stretches into its second year with no end in sight.
Britain, meanwhile, appears to be on course to leave the European Union on Oct. 31 without a transition deal, which economists fear could severely disrupt trade flows.
Akinwumi Adesina, president of the AfDB, said the bank could review its economic growth projection for Africa — of 4 percent in 2019 and 4.1 percent in 2020 — if global external shocks accelerate.
“We normally revise this depending on global external shocks that could slowdown global growth and these issues are increasing by the day,” Adesina told Reuters late on Saturday on the sidelines of the Southern African Development Community meeting in Tanzania’s commercial capital Dar es Salaam.
“You have Brexit, you also have the recent challenges between Pakistan and India that have flared off there, plus you have the trade war between the United States and China. All these things can combine to slow global growth, with implications for African countries.”
The bank chief said African nations need to boost trade with each other and add value to agricultural produce to cushion the impact of external shocks.
“I think the trade war has significantly impacted economic growth prospects in China and therefore import demand from China has fallen significantly and so demand for products and raw materials from Africa will only fall even further,” he said.
“It will also have another effect with regard to China’s own outward-bound investments on the continent,” he added, saying these could also affect official development assistance.
Adesina said a continental free-trade zone launched last month, the African Continental Free Trade Area, could help speed up economic growth and development, but African nations needed to remove non-tariff barriers to boost trade.
“The countries that have always been facing lower volatilities have always been the ones that do a lot more in terms of regional trade and do not rely on exports of raw materials,” Adesina said.
“The challenges cannot be solved unless all the barriers come down. Free mobility of labor, free mobility of capital and free mobility of people.”