DUBAI, 12 November 2006 — Dubai’s state investment firm said yesterday it might sell part of its stake in DaimlerChrysler now that the shares of the German-US auto giant are in the 45-50 euro ($57.80-$64.20) bracket.
“We are now in a position to do a partial exit of our holding in Daimler ... At this level, between 45 and 50, we believe there is an opportunity to do a partial exit,” Dubai International Capital CEO Sameer Al-Ansari told reporters in Dubai.
DIC, which became the third largest shareholder in DaimlerChrysler when it acquired a $1 billion stake in January 2005, is “looking at” making the partial exit, which “could be 10 percent, 15 percent, 20 percent,” Ansari said.
Ansari was speaking on the sidelines of a German-Arab investment conference attended by both Daimler and European aerospace group EADS.
He again denied reports that DIC would immediately acquire shares in EADS, though he did not rule out an eventual acquisition.
“At this point in time, Dubai International Capital has no intention to acquire shares in EADS,” but the parent company of troubled aircraft manufacturer Airbus could be a “possible investment opportunity for DIC” in the future, he said.
DIC is the international investment arm of Dubai Holding, which is controlled by the government of Dubai, a member of the seven-strong United Arab Emirates (UAE). Ansari also dismissed reports that DIC had immediate plans to acquire shares in electronics giant Siemens, one of the German companies attending the two-day conference, during which Arab investors will explore possibilities of buying into German firms.
“We’ve invited all these companies here so that we can talk to them ... and if we still feel that there is a good investment opportunity with any of these companies, then we will engage in further discussions,” he said.
DIC currently manages a one-billion-dollar “global strategic equities fund” which will be raised to two billion dollars in the next six months, enabling it to make investments of $10 billion, Ansari said.
Since it was established in 2004, DIC has bought the Tussauds Group, which runs Madame Tussauds wax museum, and the London Eye among other sites, for $1.5 billion.
It has also bought British engineering Doncasters Group, a supplier to the US military, for $1.2 billion.
Ansari said in an opening speech to the conference that entrepreneurs from the six Gulf Cooperation Council states currently own more than one trillion dollars in overseas assets.
With GCC states “expected to accumulate a budget surplus of $500 billion between 2005 and 2010 ... the Arab world is proving to be a very promising investment partner,” he said.
Most Arab companies attending the conference were from the UAE, with a handful from Kuwait, Qatar and Egypt, according to a list of participants.
The Dubai-based delegate of German Industry and Commerce, a branch of the Federation of German Chambers of Industry and Commerce, said the gathering had dispelled the notion that German companies are “hampered by high labor costs and taxation,” with local participants concluding that investments in German firms would be profitable in the long term.
New German investments in the Gulf are also expected to be announced in the near future, Jurgen Friedrich told AFP. He did not give details.
Friedrich said that while DaimlerChrysler and Siemens already have business ties in the Arab world, the region is uncharted territory for other participants, such as BASF, the world’s biggest chemicals maker.