MENA PE Newsletter December 2010

Saturday, January 08, 2011

MENA PE Deal space 2010

The MENA region recorded increased deal activity in the private equity (PE) space in 2010 compared to the previous year; as value of deals rose when compared to 2009. Although just one PE deal was booked in December 2010, the value of that deal was large enough to help the years total deal value surpass the figure attained in 2009. A total of 27 PE deals amounting US$993 million have been executed in 2010 as against 27 deals valuing US$680.6 million the previous year. Improvement in global economic environment and lower valuations stimulated the growth in the regional private equity space.

Exhibit 1: PE Deal Value (US$ M) & Volume 2009

400 300 200 100 0 1.5 0.0 4.5 3.0

Exhibit 2: PE Deal Value (US$ M) & Volume2010

600 450 300 150 0
December*
6.0 5.0 3.0 1.0 1.0 3.0 5.0 5.0

6.0 4.0 2.0 0.0

July October September November April February March June May January August

July

November

September

December

February

October

April

March

June

May

January

August

Deal Value

No. of deals

Deal Value

No. of deals

Source: Thomson ONE Banker, Zawya * * data taken till December 30, 2010

Top countries in MENA PE deal activity 2010

In terms of total deal value and volume, the UAE emerged as the leader among countries in the MENA region in 2010. Six PE deals, estimated to be worth US$816.5 million, including the largest deal in 2010 by Abraaj Capital worth around US$544 million, were completed in the country. Among other countries, Egypt, Jordan and Saudi Arabia came second by recording five deals each; yet Jordan surpassed Saudi Arabia and Egypt in terms of value; Jordan executed deals estimated to be worth US$109.8 million as compared to US$20 million in Saudi Arabia andUS$8.5 million in Egypt.

Exhibit 3: Top sectors by number of deals

10 8 6 4.0 4 2 0 Industrial Media Consumer Health IT Others 2.0 4.0 3.0 7.0 9.0

Exhibit 4: Top countries by number of deals

8 6 4 2 0

Lebanon

Kuwait

Jordan

Source: Zawya, Note: We have excluded deals executed in Israel

Top sectors in MENA PE deal activity 2010

Excluding Other sectors (which have not been classified), Information Technology (IT) was the leading sector in the MENA PE deal space in 2010 which witnessed seven deals during the year. IT sector also witnessed the largest deal in the year worth US$544 million executed by the leading PE fundAbraaj Buyout Fund IV, in UAE. In terms of volume, Abraaj-Riyada Enterprise Development (RED) Growth Capital (SME) Fund executed the highest number (two) deals in the IT sector in the UAE and Egypt. Media, and Consumer related sectors saw four deals each during the year, while Health sector witnessed two deals. .

Bahrain

Tunisia

Saudi Arabia

Egypt

UAE

Values of all the deals are not disclosed; this is the total disclosed value.

MENA PE Newsletter December 2010

Saturday, January 08, 2011

Deals in MENA PE space December 2010

Just one PE deal was booked in December 2010. However, the value of this deal was the largest among all deals executed in this space in 2010. On December 22, Abraaj Capital, announced acquisition of 49% stake in Dubai-based Network International LLC (Network), an independent payment solutions provider in the Middle East and Africa region. Abraaj Capital would acquired a 49% stake in Network (a wholly owned subsidiary of Emirates NBD, a leading bank in the region) for US$544.5 mln through Abraaj Financial Technologies Holdings Limited.

Deals in MENA PE space December 2010

The details of the PE deals in MENA during December 2010 are given below:

Exhibit 5: Deals in MENA PE space December 2010

Company Name Investment Date Company Nation Deal Value (US$ Million) Sector Fund Name

Network International LLC

December 22, 2010

United Arab Emirates

544.53

Information Technology

Abraaj Capital Abraaj Buyout Fund IV

Source: Thomson ONE Banker, Zawya Note: PE deals data taken till December 30, 2010

MENA PE exit deals December 2010

Two exit transactions were recorded in the MENA region during December 2010, both by Global Capital Managements PE funds. Global Opportunistic Fund I exited its investment in DEPA Limited (Depa Group), one of the worlds leading interior contracting companies, while Global Opportunistic Fund II sold its investment in Evergrande Real Estate Group (Evergrande).

Exhibit 6: Exit Deals in MENA PE space December 2010

Company Name Exit Date Company Nation Deal Value (US$ Million) Sector Fund Name IRR

DEPA Limited

December 19, 2010

UAE

NA

Interior Designing

Global Opportunistic Fund I

23%

Evergrande Real Estate Group

December 15, 2010

Hong Kong

61.2

Real Estate

Global Opportunistic Fund II

35%

Source: Thomson ONE Banker, Zawya Note: PE deals data taken till December 30, 2010

MENA PE Newsletter December 2010

Saturday, January 08, 2011

MENA PE News Wrap-upDecember 2010

NBK Capital, acquired a 20% stake in Turkey's largest aquaculture firm Kilic Deniz (Kili). The acquisition was done through its regional private equity fund, NBK Capital Equity Partners Fund I. (December 28, 2010) Abraaj Capital, announced acquisition of a 49% stake in Network International LLC, an independent payment solutions provider in the Middle East and Africa region. The transaction executed through Abraaj Financial Technologies Holdings Limited is estimated at around AED2 billion. (December 22, 2010) Abraaj Capital announced its first ever acquisition through its new income-generating real estate fund, ASAS. The transaction entails acquisition of a grade-A commercial office building in Cairo, Egypt. (December 21, 2010) Global Opportunistic Fund I (GOF I), a private equity fund of Global Capital Management Limited, exited its investment in DEPA Limited (Depa Group), one of the worlds leading interior contracting companies, thus producing an IRR of 23% on this investment. (December 19, 2010) Mubadala Development Company (MDC), the Abu Dhabi governments investment company, signed an agreement with The Carlyle Group, a global private equity firm, to invest US$500 million. (December 16, 2010) Global Opportunistic Fund II, a private equity fund of Global Capital Management Limited, concluded a profitable exit from its investment in Evergrande Real Estate Group (Evergrande), thereby realizing an IRR of 35% on this investment. (December 15, 2010) Qatar Telecom, the countrys largest telecom operator, is in discussion with the Qatar Investment Authority to set up a joint telecom investment fund. (December 12, 2010) The Port Fund, a private equity fund of KGL Investment Company, announced that its portfolio company Negros Navigation Company, Inc. (Negros) entered into an agreement with Aboitiz Group to acquire up to 100% of the outstanding common shares of Aboitiz Transport Systems Corporation (ATS) wherein Negros is a controlling shareholder. (December 06, 2010)

Source: Zawya, press releases

MENA PE Newsletter December 2010

Saturday, January 08, 2011

MENA IPO Activity2010

MENA region witnessed twenty IPO listings raising a total US$2.7 billion in 2010. In terms of volume, Saudi Arabia witnessed the largest number of IPO listing (9), followed by Tunisia (5) and Egypt (2). Bahrain, Morocco, Oman and Qatar saw one IPO listing each during the year. In terms of offer size, Omans Omani Qatari Telecommunications Company raised the maximum US$474.6 million in November, 2010 in the MENA region. Bahrains Aluminium Bahrain (Alba) raised the second largest amount of US$389.8 million in December, 2010. In terms of sectors, the financial services sector witnessed the highest (seven) listings during the year. Out of these seven, three IPOs got listed in Saudi Arabia, three in Tunisia, and the remaining one was listed in Morocco. Real Estate and Industrial Manufacturing saw three IPO listings each, followed by Food and Beverages in which two IPOs were listed. Mining & Metals, Telecommunications, Construction, Transport and Consumer Goods sectors witnessed one IPO each during the year.

Exhibit 7: IPO Listings in MENA 2010

Issuer Country Exchange Sector Offer size* (US$ million) Equity Offered Listing Date Subscription (times) 1st Day Return 1 Month Return

Modern Leasing

Tunisia

Tunis SE

Financial Services Mining and Metals

6.1

25.0%

December 03, 2010 November 30, 2010 November 29, 2010 November 22, 2010 November 01, 2010 October 23, 2010 October 17, 2010 August 11, 2010 August 09,2010 July 13, 2010 June 22,2010 June 13,2010 June 09,2010 June 08, 2010 June 06, 2010 May 17, 2010 May 11, 2010 April 01,2010 February 22, 2010 February 02, 2010

23.00 x

35.3%

44.6%

Aluminium Bahrain

Bahrain

Bahrain SE

389.8

11.5%

1.00 x

1.7%

0.6%

Amer Group

Egypt

Egypt SE

Real Estate Financial Services Telecommunications Construction Real Estate Industrial Manufacturing Real Estate Transport Industrial Manufacturing Financial Services Food and Beverages Financial Services Financial Services Consumer Goods Financial Services Financial Services Industrial Manufacturing Food and Beverages

201.2

20.0%

5.80 x

3.2%

-1.8%

CNIA Saada Assurance Morocco Omani Qatari Telecommunications Company Oman Abdullah A M Al Khodari Sons Company Saudi Arabia Mazaya Qatar Real Estate Development Company Qatar Al Jouf Cement Company Saudi Arabia Knowledge Economic City Company Saudi Arabia ENNAKL Automobiles Carthage Cement Amana for Cooperative Insurance Company Tunisia Tunisia Saudi Arabia

Casablanca SE Muscat SM Saudi SE Qatar SE Saudi SE Saudi SE Tunis SE Tunis SE Saudi SE Egypt SE Saudi SE Saudi SE Saudi SE Tunis SE Tunis SE Saudi SE Saudi SE

80.3 474.6 163.2 144.1 173.3 271.9 63.6 92.9 34.1 171.1 59.2 8.0 137.2 9.6 6.8 64.8 110.1

15.0% 40.0% 30.0% 50% 50.0% 30.06% 30.0% 49.76% 40% 39.57% 40% 30% 30% 22.22% 24.81% 30% 30%

7.46 x 1.00 x 1.00 x 1.00 x 2.00 x 1.73 x 23.00 x 13.90 x 4.52 x 6.80 x 3.03 x 20.00 x 3.50 x 30.00 x 28.49 x 4.57 x 2.41 x

33.0% 5.4% -2.5% -9.1% 24.5% 3.0% 72.6% 26.3% 35.5%

17.3% 4.3% -1.5% -17.1% 24.0% -13.5% 76.8% 45.0%

Juhayna Food Industries Egypt Solidarity Saudi Takaful Company Saudi Arabia Wataniya Insurance Saudi Arabia Al Hassan Ghazi Ibrahim Shaker Company Saudi Arabia Tunis Re Assurances SALIM Alsorayai Trading and Industrial Group Herfy Food Services Company Tunisia Tunisia Saudi Arabia Saudi Arabia

0.0% 0.0% 4.6% 42.9% 43.4% 22.6% 15.7%

5.5% 412.5% 25.0% 63.3% 45.3% 17.4% 15.2%

Source: Zawya Note *: The offer size numbers have been converted using the current exchange rate (sourcewww.oanda.com) to US$ to facilitate comparisons

MENA PE Newsletter December 2010

Saturday, January 08, 2011

MENA Fund Raising Activity2010

A total 11 funds were announced in 2010 with a total target fund raising amounting to US$3.8 billion. The largest was the Abraaj Capitals AbraajRiyada Enterprise Development (RED) Growth Capital (SME) Fund, which was announced in 2010 with an aim to raise funds totaling US$700 million.

Exhibit 8: Fund Raising in MENA 2010

Fund Name Status Announced Date Fund Manager Fund Target Size (US$ million) 500 100

Al Masah MENA Growth PE Fund EVI Capital Procurement Fund

Fund Raising Fund Raising

2010 November 10, 2010

Al Masah Capital EVI Capital Partners

Intaj Capital II Abraaj-Riyada Enterprise Development (RED) Growth Capital (SME) Fund

Fund Raising

September 10, 2010

Swicorp

300

Fund Raising

2010

Abraaj Capital

700

Middle East Venture Fund EFG Hermes Syria Fund EVI Capital Buyout Fund EVI Capital Mezzanine Fund ARC Real Estate Income Fund Shefa MENA Health Fund DB Masdar Clean Tech Fund

Fund Raising Fund Raising Fund Raising Fund Raising Fund Raising Fund Raising Fund Raising

2010 March 03, 2010 March 10, 2010 March 10, 2010 February 21, 2010 February 16, 2010 January 18, 2010

Middle East Venture Partners EFG Hermes Syria EVI Capital Partners EVI Capital Partners Arcapita Bank, Al Rajhi Capital TVM Capital MENA DB Climate Change Advisors, Masdar Venture Capital

20 250 400 400 500 100 500

Source: Zawya

MENA PE Newsletter December 2010

Saturday, January 08, 2011

Appendix 1: MENA PE deals during 2010

Target Name Network International LLC Al Noor Medical Group United Arab Investors Co Saudi ORIX Leasing Company EBLA Computer Consultancy Company Investment Date Target Nation Deal Value (US$ mn) Sector Information Technology Medical/Health Buyer Name Buyer Nation Fund Name Abraaj Capital Abraaj Buyout Fund IV Ithmar Capital Unspecified Fund Global Emerging Markets - Unspecified Fund International Finance Corporation Unspecified Fund Capinnova Investment Bank - Unspecified Fund Masdar Clean Tech Fund

22-Dec-10 22-Jun-10

UAE UAE

544.53 272

Abraaj Capital Limited UAE. Ithmar Capital Global Emerging Markets International Finance Corporation UAE

13-Apr-10

Jordan

109.7

Other Products

Switzerland

19-Jul-10

Saudi Arabia

20

Other Products

United States

22-Apr-10

Kuwait

20

Computer Software Capinnova Investand Services ment Bank

Bahrain

Industrial/Energy

Credit Suisse Private Equity United States

Industrial/Energy

Zouk Ventures, Ltd. United Kingdom

Zouk Ventures Unspecified Fund New Energies Invest AG

Industrial/Energy

Remaco Merger AG Switzerland

Enviromena Power Systems

13-Jan-10

UAE

15

Industrial/Energy Other Products

Good Energies, Inc. Switzerland Capital Trust, Ltd. United Kingdom

Good Energies Inc. Unspecified Fund EuroMena Fund Proparco - Unspecified Fund ICF Capital I KGL Investment Unspecified Fund Gulf Capital Private Joint Stock Company - Unspecified Fund Carlyle MENA Partners, L.P. Middle East Venture Fund L.P. Middle East Venture Fund L.P. NBK Capital - Unspecified Fund

Wadi Holdings Bitaka Unified Transport and Logistics Company PLC

21-Apr-10 12-May-10

Egypt Tunisia

8.5 3.9

Other Products Consumer Related

Proparco ICF Capital

France Spain

13-Jan-10

Jordan

Other Products

KGL Investment Co Kuwait

TechnoScan

15-Feb-10

Egypt

Medical/Health

Gulf Capital

UAE

Saudi Lighting Co Pin-Pay SAL

29-Mar-10 18-Oct-10

Saudi Arabia Lebanon

Industrial/Energy Communications and Media Communications and Media

Carlyle Group, The Middle East Venture Partners Middle East Venture Partners

United States Lebanon

Multilane sal

18-Oct-10

Lebanon

Lebanon

Other Products

NBK Capital, Ltd.

Kuwait

Metito Holding, Ltd.

16-Aug-10

UAE

Other Products Computer Hardware

International Finance Corporation Undisclosed Firm

United States United States

International Finance Corporation Unspecified Fund Management Actis - Unspecified Fund Middle East Venture Fund L.P.

Mediterranean Smart Cards Company ilevel Shopper Marketing Solution

27-Jul-10

Egypt

Computer Hardware

Actis Capital LLP Middle East Venture Partners

United Kingdom

18-Oct-10

UAE

Other Products

Lebanon

Source: Thomson ONE Banker

MENA PE Newsletter December 2010

Saturday, January 08, 2011

Appendix 1 continued: MENA PE deals during 2010

Target Name Gulf Union Foods Company Financial Transaction House Dermandar Dar Alwasmi Company Consolidated Services Company Al-Manara Insurance Plc Co. Investment Date Target Nation Deal Value (US$ mn) Sector Buyer Name Buyer Nation Fund Name Jadwa Food and Beverage Opportunity Fund Undisclosed Fund Berytech Fund Venture Capital Fund Bahrain Tadhamon Capital BSC - Unspecified Fund Global MENA Macro Fund Co BSC Abraaj-Riyada Enterprise Development (RED)Growth Capital (SME) Fund Intel Capital - Unspecified Fund Abraaj-Riyada Enterprise Development (RED)Growth Capital (SME) Fund Abraaj-Riyada Enterprise Development (RED)Growth Capital (SME) Fund Abraaj-Riyada Enterprise Development (RED)Growth Capital (SME) Fund

3-Jan-10 13-Sep-10 5-Oct-10

Saudi Arabia Saudi Arabia Lebanon

Consumer Related Other Products Computer Hardware NA Consumer Related

Jadwa Investment Undisclosed Firm Berytech Technological Pole Venture Capital Bank (VCBank) Tadhamon Capital BSC Global Investment House

Saudi Arabia United States Lebanon UAE

8-Jun-10 Bahrain

March,30, 2010 Saudi Arabia

NA Consumer Related

Bahrain

15-Jan-10

Jordan

Other Products

Kuwait

D1g.com

NA

Jordan

Media Information Technology

NA

NA

Jeeran

1-Nov-10

Jordan

NA

NA

E3

NA

UAE

Information Technology

NA

NA

OMS

NA

Egypt

Information Technology

NA

NA

Teshkeel Media Group

NA

Kuwait

Media

NA

NA

Appendix 2: MENA PE exit deals 2010

Date 10-Oct-10 i-Level Target Company Fund Name ABAN Seed Capital Fund LP Country Lebanon Services Sector Size (US$ mn) -

10-Oct-10

Pin Pay Rotana Hotel Management Corporation Advanced Petrochemical Company Banawi Industrial Group AES Oasis Wadi Holding KGL Logistics Masraf Al Rayan DEPA Limited Evergrande Real Estate Group

ABAN Seed Capital Fund LP

Lebanon

Information Technology

10-Aug-10

SHUAA Partners Fund I, L.P.

UAE

Leisure and Tourism

2010 10-Jul-10 H1 2010 10-Jan-10 NA NA 19-Dec-10 15-Dec-10

IDB Infrastructure Fund L.P. Global Opportunistic Fund I IDB Infrastructure Fund L.P. MENA Direct Investment Fund Global Opportunistic Fund I Global Opportunistic Fund I Global Opportunistic Fund I Global Opportunistic Fund II

Saudi Arabia Saudi Arabia UAE Egypt Kuwait Qatar United Arab Emirates Hong Kong

Oil and Gas Industrial Manufacturing Power and Utilities Agriculture Transport Financial Services Interior Designing Real Estate

96.0 8.5 NA NA NA (23% IRR) 61.2 (35% IRR)

Source: Thomson ONE Banker, Zawya

MENA PE Newsletter December 2010

Saturday, January 08, 2011

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