Daman Iraq Fund pays out first cash dividend of 20 per cent to investors

This amounts to US $ 20 per share. The Fund is a private equity initiative that was launched 18 months ago to invest in the burgeoning Iraqi market in anticipation of the post-Saddam era in Iraq.

"We are extremely pleased with this important milestone. The early believers in Iraq's economic revival have been vindicated," said Mr. Shehab Gargash, Director of the Fund. "Our strong belief in the potential of the Iraqi market coupled with our expertise on the ground in Iraq, have enabled us to secure early returns for our investors. The Daman Iraq Fund has provided a handsome return despite some very troubled times behind us," added Mr. Gargash.

Daman Iraq Fund's first financial year ended on March 31st 2004.The Fund's Net Asset Value (NAV) is indicated at US $ 256.18 per share. This translated to a growth in NAV of 156.18 per cent.

Daman had launched the Iraq Fund in January 2003, even as war clouds were gathering for the allied action that started in March 2003, and at a time of major diplomatic and military maneuvering across the globe. The Fund was introduced at a price of US $100 per share. It is a US $50 million private investment vehicle.

Good Prospects
Commenting on the performance, Dr. Mohamed Hamdan, Fund Director stated: "The Iraqi market is poised for a turn to the positive sooner or later - it is inevitable. When we get down to serious rebuilding, the sky will be the limit."

He pointed out that Daman was early to move in at a time when quality assets were going at very low valuations. "Daman expects to reap the full benefits of its long-term presence in the market where it has a track record of successful performance on the ground."

New Project Launched
Mr. Gargash also announced that Daman Iraq Fund has started construction of its second project in the heart of the Iraqi capital Baghdad. It comprises a cluster of residential villas. The project broke ground early this month, and work is to be completed before the end of the year.

Mr. Gargash adds: "This new development reiterates our long-term commitment to the Iraqi market. We are not economic soldiers of fortune. We are long-term investors who believe in the potential of the vast Iraqi market."

The project is expected to cost over US $ 2 million and will provide work opportunities for some 50 Iraqi managers, engineers, technicians and workers. This brings the total amount invested by the Fund into Iraq to over US$ 10 million. The Fund has had a fully functioning office in Baghdad since May 2003.

Daman had earlier announced a similar residential compound that it had developed and leased, just as other Iraq-oriented funds were struggling to gain inroads into the volatile but promising market. The first project was also for a residential villa complex, also in the centre of Baghdad. The project was completed in November 2003.