Kuwait’s Biggest Lender Unit Plans Buyout Fund as Deals Gain

NBK Capital Ltd., the investment banking arm of National Bank of Kuwait SAK, plans to raise as much as $300 million for a second private-equity fund as deals accelerate, Chief Executive Officer Salah al-Fulaij said.

“We are expecting it to be launched late this year or early next year,” al-Fulaij said yesterday in an interview in Kuwait City. “The appropriate fund size, given regional opportunities, is $250 to $300 million, like the first fund.”

The new fund will invest in the Middle East and North Africa region, he said, with a focus on middle-size companies in Turkey, Saudi Arabia and the United Arab Emirates. The bank expects to announce a private-equity deal in Saudi Arabia within the next couple of weeks, he said, without giving more details.

The company’s first $300 million private-equity fund was set up in 2006 with a 10 percent contribution from NBK, the country’s biggest lender. “This fund is fully deployed,” Al-Fulaij said. “Some exits happened and others will happen.”

NBK Capital is advising Qatar Telecom QSC on its $2.2 billion purchase of a 47.5 percent stake in Kuwait’s National Mobile Telecommunications Co. It’s also advising Kuwait Telecommunications Co., the country’s third-largest mobile phone operator, on a proposed share listing.

M&A Transactions

‘We are also active in advising six M&A transactions in Kuwait and throughout the Gulf Co-operative Council, which we expect to close during 2013,” al-Fulaij said, without giving further details.

NBK Capital, which in 2009 started the first dedicated mezzanine fund in the Gulf Arab region that lends to private-equity companies and to those seeking long-term financing, is expecting to complete two mezzanine financings in Turkey and the U.A.E before end of 2012, al-Fulaij said.

The bank is also part of a committee advising on the construction of Kuwait’s rail network under the government’s Public-Private Partnership program. It was also the manager of recent bond sales by Commercial Facilities Co. and Kuwait Projects Co, he said.

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