Ithmar Fund II raises over US 60 million in first closing

"There has been intense local, regional and international interest in this fund which will capitalise on the new investment opportunities being generated by the surging Gulf economies," said Faisal Juma Belhoul, Founder and Managing Partner, Ithmar Capital. "The launch of the fund has been timed to take advantage of the attractive proprietary and quality deal flow being sourced by Ithmar's high level network and connectivity within the region.

"This closing follows the successful performance of Ithmar Fund I, which invested US $70 million in a portfolio of seven companies in various high growth sectors. These include healthcare, education, light manufacturing and distribution. The highly experienced Ithmar team has created substantial value within the Fund I portfolio of companies and has realised attractive returns through a partial exit to a strategic buyer of one of its investments."

Ithmar will concentrate its Fund II investment activities on companies operating within the GCC region or international companies with substantial growth potential in the GCC.

As with its predecessor, Fund II will follow a sector opportunistic investment approach with preference given to those sectors which have traditionally demonstrated high growth potential and where Ithmar believes attractive capital appreciation can be achieved.

"An opportunistic, rather than a prescriptive, approach is preferred so that investment is not bound by hard rules and restrictions which might not be responsive, or appropriate, given the rapid changes occurring in regional economies," said Belhoul.

"However, we have a disciplined investment approach driven fundamentally by our ability to add value to our investments in terms of strategy and returns going forward."

Ithmar Capital says private equity is one of the fastest growing industries in the GCC.

"The private equity industry is growing both in terms of investment opportunities and investor appetite," said Khaldoun Haj Hasan, Managing Partner, Ithmar Capital. "In addition to the positive economic factors that the region is currently enjoying, a key growth driver has been a substantial shift in the regional mindset, particularly within family businesses, towards the benefits of restructuring and inbound investment. Family businesses are now much more receptive to private equity-assisted growth.

"There is a substantial increase in the amount of institutional private equity money under management and the numbers of new players entering the market. At this stage, this is healthy for the development of the industry as players can do club deals together and even sell to each others and create more exit options. However as the industry further matures, sustainability will come to those firms with sound and focused business models and which can demonstrate adding value to companies, especially operationally," added Haj Hasan.