The Fund is focused on investing in private equity opportunities in Kuwait and is approved by the National Offset Company ("NOC") as a vehicle for foreign contactors to fulfil their Offset obligations.
The investment strategy of the Fund is to focus on private equity investments in high-growth sectors such as education, healthcare, manufacturing, and technology within the State of Kuwait. The Fund will mainly invest in growth capital but will also participate in specific early-stage opportunities that offer a favourable risk/return profile. In addition, the Fund will actively pursue opportunities that will further the NOC's objective to cultivate social, economic, and technological developments for the State of Kuwait.
The Fund will enable foreign contractors to transfer the burden of arranging their offset obligations to NBK Capital, relieving them of the requirement to invest resources in identifying, analysing, operating, monitoring and eventually exiting offset business ventures. NBK Capital has assembled a highly professional team skilled in the structuring of complex financial transactions with in-depth knowledge of the legal, administrative and market specifics of Kuwait.
Amjad Ahmad, Chief Executive - Investment & Merchant Banking, NBK Capital, said: "This is one of the first National Offset Company (NOC) approved funds in Kuwait and we are delighted to be involved in the development of strategic sectors in Kuwait through a proactive investment approach."
"Our aim is to invest alongside solid partners and actively help them achieve their strategic and operating goals to build sustainable companies. The expertise of the Fund's management team, supported by the full services of NBK Capital is a key asset and differentiator that will contribute to the success of each portfolio company within the Fund."
Faisal Al-Hamad will be leading the Fund's management team supported by a strong professional team with extensive local experience.
He added, "Kuwait has benefited from strong economic growth in recent years as a result of the surge in oil prices and reinvestment of petrodollars and this, coupled with a substantial increase in government spending and an appealing demographic profile, has resulted in significant investment opportunities in Kuwait's economy. NBK Capital is ideally positioned to partner with the NOC and advise foreign contractors in the Offset program that will in turn contribute to the development of Kuwait's economy."
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NBK Capital launches $125m Kuwait Investment Opportunities Fund
- Kuwait: Tuesday, May 06 - 2008 at 15:34
- PRESS RELEASE
NBK Capital, one of the leading regional investment banks, has successfully launched the Kuwait Investment Opportunities Fund with assets under management of $125m.
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About Kuwait Offset Program and The National Offset Company (NOC)Kuwait Offset Program was established in accordance with Council of Ministers' Decision No. 694/1992, and was managed through the Counter-trade "Offset" department within the Ministry of Finance_:" ...department within the Ministry of Finance(MOF)...". Almost two decades later, the National Offset Company (NOC), a state owned shareholding corporation, commenced operations on September 2006, to manage the offset program on behalf of MOF as specified in the Management Contract signed between both parties.
Offset, as a form of counter-trade, resembles a compulsory commitment requiring transnational corporations that receive large Government contracts to carry out an investment scheme as a prerequisite to a winning contract.
Offset programs are a common and a growing feature of worldwide government procurement contracts, both military and, to a lesser extent, civilian as about 60% of countries with military offset programs impose offset obligations on civilian contracts as well.
Offset has started and become widely applicable in the advanced countries, which accounted for majority of the value of the global offset contracts, then it was extended to the developing countries and economies in transition.
The average offset obligation reached around 100% of the value of the supply contract in Europe, and around 60% in the rest of the World. By comparison, Kuwait imposes an offset obligation of 35% of the monetary value of the supply contract.
Direct Offset projects: offset investments made by the foreign contractors in areas relating to their core competencies, or to benefit the beneficiary government entity. Direct offset has proven particularly useful in developing local suppliers and in transferring to them the technical and managerial know-how on a sustained basis and in a cost-effective manner.
Indirect Offset projects: offset investments made by the foreign contractors, or third parties, in areas unrelated to their contracts. They include maintenance, training, marketing, and technology transfers. Indirect offset provides an opportunity to diversify the domestic economic base.
www.kuwaitnoc.com/noc/offset.html
About NBK Capital
NBK Capital is a regional investment bank that employs 120 experienced finance professionals across the region in offices in Kuwait, Istanbul and Dubai. The company aims to deliver innovative diversified services and products to businesses across the region. NBK Capital has a deep understanding of the business, cultural and regulatory environment of the Middle East region and is able to leverage its relationship with NBK, the highest rated bank in the region that operates in 17 international markets.
For further information, please contact:
Qutaiba AlRabe
Assistant VP - Corporate Communications
NBK Capital
Tel: +965 2246925
Dina Sabry
Media Relations Manager
Hill & Knowlton
Tel: (+965) 232 2976
Mobile: (+965) 944 5975
Posted by Medilyn Manibo, Assistant News EditorTuesday, May 06 - 2008 at 15:34 UAE local time (GMT+4)
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