Kuwait Projects Company (KIPCO), the major diversified investment holding group of the Middle East and North Africa region, sealed the successful closure of its recent US$ 175 million syndicated term loan facility in a ceremony with leading European banks mandated as lead managers.
The ceremony in Dubai concluded formalities with mandated lead managers Dresdner Kleinwort Wasserstein of Germany, HSBC Bank plc of the UK, and Austria’s Raiffeisen Zentralbank Österreich Aktiengesellschaft. Also present were representatives of prominent international and regional banks involved as arrangers in the syndication, including Emirates Bank, National Bank of Dubai, BNP Paribas, and the State Bank of India.
The five-year term US$ 175 million syndicated loan follows the success of KIPCO’s debut syndicated term loan facility in December 2004, which opened at US$ 75 million and closed oversubscribed at US$ 100 million.
The new syndication opened at US$ 100 million, and was also oversubscribed and capped at US$175 million after keen demand. It has a longer term than the three years of the first syndication, but is fixed at the same rate.
“This latest syndication was completed within six months of our debut syndication, demonstrating market confidence in KIPCO and further recognition of our growing stature and importance in the worldwide financial markets,” said KIPCO managing director and chief executive officer Faisal Al Ayyar.
“The solid demand received from regional and international markets signifies KIPCO’s presence as a respected international player on the global financial stage. It’s particularly noteworthy that more than half the final distribution of the syndication came from Europe and Asia,” he said.
He added that KIPCO was well on track to meet its 2005 full year profit forecast of KD 33.5 million (US$114.7 million) made at the recent KIPCO Group “Shafafiya” (Transparency) Forum in Kuwait following the 31 per cent surge in half year profit to KD 17.1 million (US$ 58.6 million).
Lenders involved in the five-year US$ 175 million term loan, fixed at the London Interbank Offer Rate (LIBOR) plus a margin of 1.25 per cent, are from Europe, the Middle East, and Asia.
Final geographical distribution of the syndication by region was: Europe 50
per cent; Asia 16 per cent; and Middle East 34 per cent.
The term loan will complement the depth and quality of KIPCO’s institutional lending base, reduce costs, extend the maturity profile of its liabilities, and enhance the currency diversification as part of an overall liability management strategy.
KIPCO, with more than US$ 15 billion in assets under control or management, controls or holds substantial stakes in some 55 companies throughout the Middle East and North Africa region. Core activities are in financial services and media & telecommunications, in addition to real estate, manufacturing, management & advisory, medical services, aviation and education. KIPCO Group’s holdings and interests also extend to the U.S., Europe, and India.
KIPCO’s shares are the most actively traded on the Kuwait Stock Exchange. Its core operating companies are investment banking subsidiary United Gulf Bank (UGB); Gulf Insurance Company (GIC), a regional leader in commercial and personal insurance; Burgan Bank, Kuwait’s leading technology-driven commercial bank; the fast-growing regional mobile telephone services provider Wataniya Telecom; and Showtime, the popular digital pay-TV service spanning the Middle East and North Africa.
