Delta Capital closes private equity fund targeting the Middle East telecom market and increases fund size to USD100 M

Due to strong demand from investors from across the region, Delta Capital has been able to reach its target commitment of US$75 million earlier than expected. The fund closing, initially targeted for March 31st, 2007, was moved up to start executing on a very strong pipeline of investment opportunities. In addition, it was decided to increase the size of the MENA Telecom fund to a maximum of US$100 million in order to accommodate this increased investor demand, with a second and final closing to be held on March 31st, 2007. As part of the commitment, the partners and employees of Delta Capital and Delta Partners are investing US$7.5 million in the Fund.

Nezar Al Saie, Chairman of the MENA Telecom Fund commented: "The Fund's investor base represents a select group of blue-chip investors from around the GCC, with both institutions and family offices represented. The investor base also includes a selected group of strategic investors who have a broader interest in the telecom sector, and who will invest alongside the fund in certain opportunities where there is room for co-investors to participate."

The Fund is currently considering a range of investment opportunities across the telecom value chain, including companies focused on network engineering and roll-out, call centres, distributors, and alternative telecom service providers. The Fund is focused on investments in already established companies where there is a significant potential for future growth and where the industry knowledge, resources and relationships of Delta Partners can be utilized to add value to each investment.

"We see a number of very exciting opportunities coming from our priority markets across the GCC countries", said Morten Kvammen, Head of Private Equity at Delta Capital. "We are also pursuing investments outside our primary focus markets across the MENA region on an opportunistic basis."

Delta Capital B.S.C.(c) is part of the Delta Partners group, the leading telecom advisory and investment firm in the MENA region with more than 60 professionals focused exclusively on the telecom sector. Delta Capital will utilize Delta Partners' industry experience and expertise to extract above average returns from its investments through close collaboration with its portfolio companies. The specific industry and investment expertise and close ties with Delta Partners puts Delta Capital in pole position to capitalize on business opportunities related to the liberalization process of the telecom sector currently sweeping the broader MENA region.

Key figures and information about the telecom sector in the Middle East from Delta Capital B.S.C:

• The US$50 billion telecommunications industry in the Middle East is one of the fastest growing in the world with compounded annual revenue growth of approximately 12% per annum, indicating that the industry will double in size to US$100 billion during the 7 year lifespan of the MENA Telecom Fund. In addition, the emerging specialized players across the telecom value chain where the Fund is targeting its investments are expected to increase its share of the sector from 2-3% today to 15-20% in the next 7 years. This drives growth in the target segments from US$1-2 billion of revenues today to US$15-20 billion in the next 7 years.

• The $100 million fund targets an annual rate of return in excess of 25 percent net of fees and focuses on taking majority or significant minority stakes in investee companies, investing on average US$8-12 million per investment.

• Increasing levels of liberalisation and competition are driving the creation of
opportunities across the value chain

• Advances in regulation, technology and business models are expected to open
up further opportunities within telecom and related industries