Hisham Al-Razzuqi, Chief Executive Officer of GIC
Gulf United Steel Holding Company (“Foulath”), a leading global steel investment vehicle and the world’s first fully integrated steel producer, today announced the acquisition of United Gulf Steel Mill Company Limited (UGS) based in the Kingdom of Saudi Arabia by its subsidiary United Steel Company (“SULB”), a steel manufacturing joint venture between Foulath (51%) and Japan’s Yamato Kogyo Co., Ltd, (49%), a leading global section producer for the production of beams and structural steel sections.
Foulath’s shareholders are among the region’s most reputable and committed investors, each with a long track record of investment in the regional steel and metals industry and other key economic sectors. Gulf Investment Corporation (GIC), Kuwait, which is owned equally by the six governments of the GCC owns 50%, Qatar Steel Company, Qatar owns 25%, Mohammed Abdulmohsin Al-Kharafi & Sons Company, Kuwait owns 10%, National Industries Holding Group, Kuwait owns 10% and Kuwait Foundry Company, Kuwait owns 5%.
GIC is a leading financial institution offering a comprehensive range of financial services. GIC was established in 1983 to reflect the desire of the GCC countries to establish an investment entity to promote the role of private sector in economic activity and support economic development in the GCC region.
GIC has focused its activities in direct investment in new projects in the GCC countries, providing investment banking services to both, private sector and governments, as well as to invest in GCC and global markets. GIC has invested in about 50 projects in the vital sectors, specially Steel, Chemicals, Petrochemicals, Utilities etc., in partnership with others both, private and government sectors.
GIC is the largest non-Bahraini investor in the Kingdom of Bahrain with the market value of investments of about $ 6 billion in the key sectors of iron & steel and energy.
Commenting on the announcement of UGS acquisition, Mr. Hisham Al-Razzuqi, Chief Executive Officer of GIC said: “The acquisition of UGS with an annual capacity of 450,000 tons of light & medium sections and beams by SULB emphasizes GIC’s main mandate in developing the economy of the region through investments in profitable projects or acquiring companies that are facing difficulties and turn them around to profitable companies. For example in 2000, GIC acquired Gulf Industrial Investment Company (GIIC) in the Kingdom of Bahrain, pelletizing plants with an annual capacity of 12 million tons of pellets, which was underperforming, and with the knowledge and experience of GIC in industrial investments, succeeded in turning the company into one of the most profitable companies in the region. Similarly, SULB has acquired UGS, who were facing financial difficulties, to turn it around to profitability by integrating it with Foulath’s fully integrated facility in the Kingdom of Bahrain.”
Mr. Al-Razzuqi further highlighted: “UGS being part of Foulath will benefit from the integration by securing raw material (billets) from SULB on a continuous basis at a very competitive price, enabling it to penetrate the market, ensuring its sustained profitability.”
Mr. Al-Razzuqi added: “SULB and UGS currently are the only producers of a full range of light, medium and heavy, sections and beams in the region with a combined capacity of about 1.1 million tons a year which will replace about 25% of the total annual imports of 4 million tons.”
Mr. Al-Razzzuqi concluded: “GIC will continue to support private and government sectors to advance its mission and play a major role in supporting the growth and further development of the GCC economies.”