DUBAI, June 8, (RTRS): Kuwait Projects Co (KIPCO), the largest investment company in the Gulf state, is eyeing acquisition opportunities in the banking and insurance sectors, its chief financial officer said on Wednesday.
The firm was evaluating new deal opportunities, Pinak Maitra told Reuters on the sidelines of a conference, but had no imminent plans for a new investment.
“The primary sectors where we will like to carry out an acquisition if the price and fit are right are in the commercial banking and insurance sectors,” he said.
Maitra also said the company was not in need to raise any new funds, but would do so based on specific investment needs or appealing pricing.
“We don’t have an immediate need to raise funding, it will be linked to investment opportunities or to optimisation of funding costs,” Maitra said.
KIPCO repaid a $350 million bond in April at maturity, and at the time, Maitra said the company planned to pay all 2011 maturities on time or ahead of schedule.
The company’s last bond issue under its Euro medium term notes (EMTN) programme was a 10-year $500 million bond in July last year at 9.5 percent.
Kuwait’s Burgan Bank is KIPCO’s commercial banking arm, and the firm also has stakes in United Gulf Bank, as well as other financial services sector companies across the Middle East and North Africa.
Meanwhile, the Kuwait Projects Company — has announced a net profit of KD 8.1 million ($29.2 million), or 6.84 fils ($2.47 cents) for the first three months of 2011 - an increase of 300 per cent compared to the KD 2 million ($6.93 million) profit or 1.73 fils ($0.60 cents) per share, reported for the same period last year.
KIPCO’s total revenues for the first three months of 2011 increased by 18 per cent to KD 93.2 million ($336.2 million) from KD 78.8 million ($273 million) in the first quarter of 2010.
The company also reported a rise in operating profit to KD 18.2 million ($65.6 million) for the first quarter of 2011 - an increase of 22 per cent from the KD 14.9 million ($51.6 million) in the first quarter of 2010.
KIPCO’s consolidated assets decreased in the first quarter of 2011, to KD 5.52 billion ($19.9 billion) from KD 5.66 billion ($20.2 billion) for the year end 2010.
Mr Masaud Hayat, KIPCO’s CEO Banking, said KIPCO’s first quarter results were in line with the expectations voiced by the company at its recent Investor’s Forum:
“At our Shafafiyah Investor’s Forum in March, we highlighted some of the growth trends emerging from our core operating companies. These trends are now beginning to have a very positive effect on our results. If global, regional and local markets maintain their recovery from the financial crisis, we can expect to see further growth in our results.”
“Profitability from most of our operating companies has improved over the year and this growth is in line with our expectations. We are confident that this growth curve will continue.”
KIPCO announced earlier that it has repaid its debut $350 million five-year bond issued under its $2 billion Euro Medium Term Note (EMTN) bond programme.
KIPCO’s EMTN programme was launched on 12th April, 2006. The issue - listed on the London Stock Exchange - was the first by a private sector corporate from the Middle East. The programme offered international investors their first opportunity to diversify from the US dollar Floating Rate Notes usually offered by banks in the Gulf region at that time.
Since the debut issue under the EMTN programme in April 2006, KIPCO has been a frequent and successful bond issuer, gradually extending the term of its issues.
In October 2009, KIPCO issued a $500 million seven year note and in July 2010 the company further extended its funding, by issuing a $500 million ten year note - the first ten-year note issued by a MENA private sector corporate. The company said this was a sign that the international debt capital markets understood KIPCO’s long-term business strategy.