UAE, Bahrain companies join hands to set up USD1 billion holding company to invest in infrastructure development & projects in Egypt

The agreement was signed by three authorities - General Authority of Roads, Bridges and Land Transportation, Egyptian National Rail Authority and Port Said Port Authority - in the presence of Dr. Ahmed Nazif, the Prime Minister of Egypt and Eng. Mohammed Lutfi Mansour, Minister of Transportation.

The holding company which will be jointly owned by NH, Abu Dhabi Investment House P.J.S.C, the Bahrain-based Islamic investment bank, Gulf Finance House (GFH) and Global Development and Investments, among others will focus on US$30 billion developments across Egypt and in the next six months will start work starting with highways of international quality.

Commenting on the partnership after the signing ceremony, the Minister of Transportation for Egypt, Eng. Mansour, said: 'The transportation sector in Egypt has stirred tremendous enthusiasm among the local and foreign investors and we are confident to draw in more investments to the country. Significantly, there is tremendous investor interest from the Arab world in this sector recently and we are looking at more partnerships.'

The agreement is a pioneering initiative and this is the first time public and private sectors have joined hands to pursue development of infrastructure and projects in Egypt.

The minister said the new holding company will also spin off subsidiary investment companies focusing on individual projects as it moves ahead with its investment strategy. These entities will be entrusted with the development of various transportation projects on the basis of Build Own Operate and Transfer (BOOT) system.

'We are confident that these projects will generate job opportunities in accordance to the vision of the President of Egypt, Mr. Hosni Mubarak, and in turn help in social and economic development in new cities in the country and Upper Egypt,' the minister added.

Commenting on the foray into Egypt, Mr. Jawaan AL Khaili Chairman of National Holding and ADIH, said: 'The economic partnership between Egypt and the UAE has kept apace with the growing bilateral relations between the two countries. The UAE is one of the largest foreign investors in Egypt and reportedly Abu Dhabi Investment Authority has invested some US$400 million in Egypt, spanning sectors such as telecommunications, cement, agriculture and finance.'

He said the depth of the UAE-Egypt relationship is also reflected in the building of Sheikh Khalifa City in Egypt. 'We are confident that our entry into Egypt will further strengthen relationship between the UAE and Egypt with benefits to all,' AL Khaili added.

The Abu Dhabi-based National Holding was established in 1999 and has grown significantly managing various investments in the UAE and the MENA region. NH owns significant stakes in North African companies such as Orascom Telecom Algeria and Citadel in Egypt. It is also a significant stakeholder in National Bank of Abu Dhabi, Abu Dhabi Islamic Bank, Abu Dhabi Commercial Bank, among others.

AL Khaili added: 'The Ministry of Transportation's policy to support the partnership between the public and private sectors is indeed a great vision which will in turn catalyse development. Private sector has the experience and expertise in the latest management and operations systems and they can also raise funds which can be used under the directives of the ministry for developmental purposes.'

ADIH in a short span of one year has made a mark in offering sophisticated investment products focused in the region. The financial institution's investment portfolio includes Beirut Gate, The Lagoon in Bahrain and investment instruments such as Al Arabi Private Equity Fund and a German property fund. It had also participated in the private placement of Energy City Qatar raising US$100 million exclusively from the UAE market.

Commenting on the rationale of entering Egypt, Mr. Rashad Janahi, Chief Executive Officer of ADIH said: 'As a financial institution clued in to the economic indicators of the region, we are confident that investments in Egypt will be beneficial to our investors and stakeholders. We see tremendous economic growth prospects in Egypt as the country is in the midst of a growth trail with IMF predicting that the economy will grow at 5.3 per cent in 2006.'

GFH which is also a significant partner in the holding company is a leading Islamic investment institution based in Bahrain. GFH is the originator of various regional projects including Bahrain Financial Harbour and Al Areen development in Manama, Royal Metropolis in Jordan and Legends in the UAE. Recently, GFH also announced its foray into Morocco.

Both ADIH and GFH are also equity partners in the Prince Abdul Aziz Bin Mousaed Economic City in Saudi Arabia.