Gulf Capital, the Abu Dhabi-based alternative asset management firm, has raised Dh850 million of debt to help fund growth, but is still considering an initial public offering when market conditions allow.
The firm announced the syndicated revolving facility arranged by two local banks, Abu Dhabi Commercial Bank and FGB, which leaves it “extremely well funded”, according to the chief executive Karim El Solh.
But he said: “An IPO is still something we are considering for the future. When markets come back, we’re still interested in doing an equity capital markets deal.”
Financial market professionals have been expecting news of a Gulf Capital IPO for some time, possibly in the current first quarter of this year. The company has never formally declared its IPO plans.
However, the volatility of UAE equity markets as a result of the plunging oil price has pushed back the prospect of an IPO until later this year. Mr El Solh declined to specify a time frame for an IPO.
“We are always looking at the capital markets, and in the current environment of low interest rates and banking liquidity, today it looks better to go for debt rather than for equity,” he said.
Local stock markets have experienced high volatility as the price of crude fell more than 50 per cent since their summer peaks. The Abu Dhabi Securities Exchange General Index lost as much as 23.8 per cent between October and mid-December.
In December, UAE bank lending growth also slowed, to 9.5 per cent year-on-year from 10.2 per cent in November, according to Central Bank data.
The new borrowing facility comes just after Gulf Capital closed its third and largest private equity fund, which at US$750 million is the biggest in the region for three years.
“We’re entering 2015 extremely well funded and open for business. We have more and bigger deals in the pipeline. It’s a good time to be looking at transactions in the Gulf,” Mr El Solh said.
Simon Penney, head of wholesale and international banking at FGB, said: “This new facility further strengthens our successful business relationship with Gulf Capital, as well as its portfolio companies, and we’re committed to supporting the company in its future growth plans.”
Colin Fraser, head of wholesale banking at ADCB, added: “The facility is well structured to suit the liquidity requirements of the company and clearly enhances our commitment to assisting it.”
fkane@thenational.ae
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