Global Investment House KSCC, which has restructured US$1.7bn of debt twice in the past five years, is in talks to sell its 51 per cent stake in Oman’s Al Jazeera Steel Products Co, two people familiar with the matter said.
The Kuwaiti bank, which bought the stake in 2007, has held discussions with regional investment firms interested in the business, the people said, asking not to be identified as the information is confidential. The talks are ongoing and an agreement has yet to be reached, the people said. The stake is worth about US$75mn based on Al Jazeera Steel’s market value, according to data compiled by Bloomberg.
Gulf companies that restructured debt during the financial crisis are now selling assets to pay back creditors as the bills come due. Abu Dhabi’s Al Jaber Group, a family-owned conglomerate, has hired Barclays Plc to advise it on the sale of its transportation and lifting unit to repay debt, people with knowledge of the matter said last week.
Global, which was co-founded in 1998 by chairman Maha Khalid al Ghunaim, reached an agreement to restructure US$1.7bn of debt in 2009. Two years later it again turned to creditors, seeking a ‘more comprehensive’ arrangement, it said at the time. It then withdrew from the Kuwaiti stock exchange and transferred investment assets to a special fund vehicle, which it manages for creditors.
Al Jazeera Steel, based near Sohar, makes steel tubes and structural products. The company exports to around 25 countries and reported a profit of RO4.6mn in 2013, an increase of 33 per cent from the previous year, according to its annual report.
In the first half of 2014, Al Jazeera Steel posted a net profit of RO3.46mn, up 18 per cent from a year ago. Sales rose by six per cent to RO49.35mn, according to a filing with the Muscat Securities Market (MSM).
The stock closed Wednesday’s trading on the MSM down 0.87 per cent at 454bz.
A spokesman for Global in Kuwait declined to comment, while a representative for Al Jazeera Steel did not respond to telephone and e-mail requests for comment.© Copyright - Muscat Daily