The new Dh1 billion ($272 million) Emirates Growth Fund launched in the UAE on Monday will take minority stakes in small businesses in the country as it seeks to bridge the financing gap faced by small and medium enterprises.
The fund, backed by the Emirates Development Bank, will focus on businesses in advanced manufacturing, health care, food security and advanced technology, Najla Al Midfa, vice chair and managing director of the fund, said in a press conference on the sidelines of the Make it in the Emirates event on Monday.
"EGF will be focusing on companies born and based here in the UAE, generating revenues of over Dh10 million," she said. "We will invest between Dh10 million and Dh50 million, taking active minority stakes, usually between 20 per cent and 40 per cent of the company, while leaving founders firmly in control, because we believe our role is to empower and not to control."
Currently, SMEs account for 94 per cent of all registered companies in the UAE, employ more than 86 per cent of all private-sector jobs and also contribute more than 60 per cent to non-oil gross domestic product, according to Dr Ahmad Al Falasi, the UAE Minister of Sports, who will serve as EGF chairman.
However, their share of funding is only 10 per cent, with a big gap of about $2 billion of funding, he said at the event.
"Too many SMEs based in the UAE with strong fundamentals and big ambitions often hit a ceiling, not because they lack vision but because the funding landscape doesn't meet them where they are," Ms Al Midfa said.
These companies may be in sectors not relevant to venture capital funds but they are also not yet large enough for traditional private equity. "They sit in what we call 'the missing middle'," she said.
The fund will target such companies, with its first investment being in Abu Dhabi-based Tarmeem Orthopedic and Spine Specialty Hospital, Ms Al Midfa confirmed. The hospital, set up in 2019, treats more than 20,000 patients annually.
"Unlike most funds, we don't have a fixed investment and divestment period," she said. "So we see ourselves as long-term partners with these companies.
"Yes, eventually, we obviously would like to exit [those stakes] ... we do have commercial objectives in addition to the economic impact," she said. "However, we will only exit when the time is right for the company, and that may be seven years ... maybe 10 years. We're happy to wait as long as it takes for that company to have that stable foundation and to be ready for that exit."
The exits are expected to be through a strategic acquisition or a stake sale rather than an initial public offering, given the size of the companies.
"But what we are doing is putting in place fundamentals like governance, so that down the line if they do decide to IPO, it will at least help them build that foundation," Ms Al Midfa added.
'Gold'
Director:Anthony Hayes
Stars:Zaf Efron, Anthony Hayes
Rating:3/5
UAE currency: the story behind the money in your pockets
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
Company%20Profile
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How to help
Donate towards food and a flight by transferring money to this registered charity's account.
Account name: Dar Al Ber Society
Account Number: 11 530 734
IBAN: AE 9805 000 000 000 11 530 734
Bank Name: Abu Dhabi Islamic Bank
To ensure that your contribution reaches these people, please send the copy of deposit/transfer receipt to: juhi.khan@daralber.ae
The specs
Engine: 3.8-litre, twin-turbo V8
Transmission: seven-speed automatic
Power: 592bhp
Torque: 620Nm
Price: Dh980,000
On sale: now
In numbers: China in Dubai
The number of Chinese people living in Dubai: An estimated 200,000
Number of Chinese people in International City: Almost 50,000
Daily visitors to Dragon Mart in 2018/19: 120,000
Daily visitors to Dragon Mart in 2010: 20,000
Percentage increase in visitors in eight years: 500 per cent
The biog
Profession: Senior sports presenter and producer
Marital status: Single
Favourite book: Al Nabi by Jibran Khalil Jibran
Favourite food: Italian and Lebanese food
Favourite football player: Cristiano Ronaldo
Languages: Arabic, French, English, Portuguese and some Spanish
Website: www.liliane-tannoury.com
Farage on Muslim Brotherhood
Nigel Farage told Reform's annual conference that the party will proscribe the Muslim Brotherhood if he becomes Prime Minister.
"We will stop dangerous organisations with links to terrorism operating in our country," he said. "Quite why we've been so gutless about this – both Labour and Conservative – I don't know.
“All across the Middle East, countries have banned and proscribed the Muslim Brotherhood as a dangerous organisation. We will do the very same.”
It is 10 years since a ground-breaking report into the Muslim Brotherhood by Sir John Jenkins.
Among the former diplomat's findings was an assessment that “the use of extreme violence in the pursuit of the perfect Islamic society” has “never been institutionally disowned” by the movement.
The prime minister at the time, David Cameron, who commissioned the report, said membership or association with the Muslim Brotherhood was a "possible indicator of extremism" but it would not be banned.
UAE rugby in numbers
5 - Year sponsorship deal between Hesco and Jebel Ali Dragons
700 - Dubai Hurricanes had more than 700 playing members last season between their mini and youth, men's and women's teams
Dh600,000 - Dubai Exiles' budget for pitch and court hire next season, for their rugby, netball and cricket teams
Dh1.8m - Dubai Hurricanes' overall budget for next season
Dh2.8m - Dubai Exiles’ overall budget for next season
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UAE currency: the story behind the money in your pockets
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The stats
Ship name: MSC Bellissima
Ship class: Meraviglia Class
Delivery date: February 27, 2019
Gross tonnage: 171,598 GT
Passenger capacity: 5,686
Crew members: 1,536
Number of cabins: 2,217
Length: 315.3 metres
Maximum speed: 22.7 knots (42kph)
The%20specs
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Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
THE%20SWIMMERS
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