Interview: Mahmood Hashim Al Kooheji
What shape will Mumtalakat’s investment strategy take in 2013, and what outcomes do you expect?
MAHMOOD HASHIM AL KOOHEJI: It is important to adopt a focused approach to investment, one that is built on value creation and growth-enhancing initiatives that will contribute to the sustainable development of the Bahraini economy over the long term.
The investment strategy therefore consists of two strategic pillars. The first focuses on developing our existing portfolio companies by continuously collaborating with their respective boards and management teams. The second strategic focus is to develop new projects in Bahrain for existing and new sectors, as there are numerous attractive opportunities on the island and in the region which would be beneficial. In early 2013, we unveiled plans for $150m of investments to be made in the local economy, which will help to spur further investment. The majority of the funds will be allocated towards real estate, downstream aluminium industries, and tourism and hospitality schemes.
Furthermore, we aim to attract partner investors and multinationals to set up operations in Bahrain and consider exploring joint venture partnerships with Mumtalakat. These companies can benefit from Bahrain’s strategic location between the East and West, our great relationships with the GCC countries and the support of sovereign lending to its investment arm; in addition, we offer access to over 35 prominent commercial enterprises operating in Bahrain. We are confident that 2013 will see the achievement of significant milestones in line with these strategic objectives.
What types of operational strategies are necessary for an adequate restructuring of Gulf Air?
AL KOOHEJI: There’s no doubt that Gulf Air has been affected by global and regional risks in recent years. Our approach is to work closely with the company and the Government of Bahrain as needed to implement the appropriate restructuring plans. For Gulf Air, the focus is on re-aligning the network, simplifying the fleet and right-sizing the company. This process is already in progress and we believe that our efforts will see Gulf Air become a financially stronger airline that is able to better serve the Bahraini population.
In your view, which sectors offer the greatest opportunity for private investment in 2013?
AL KOOHEJI: Many industrial sectors exhibit strong potential for growth in the region, such as aluminium, manufacturing, tourism, hospitality, ICT, education and health care, to name a few. Mumtalakat is actively exploring initiatives in the aluminium sector with the development of an aluminium downstream cluster, as well as in the real estate sector with the development of destinations in the southern part of the island. Such sectors will not only help grow the wealth of Bahrain, but will also generate employment opportunities in the kingdom, which is one of our main priorities.
What are the key factors investors should focus on when examining Bahrain’s real estate market?
AL KOOHEJI: The Bahraini real estate market is seeing a number of positive developments in terms of regulation and an overall increase in consumer confidence and market demand. As a result we have seen developers resuming activity in the kingdom. We are actively exploring potential investments in the real estate and hospitality sectors, and we are confident that significant milestones in these industries will be achieved by the end of 2013.
How did Mumtalakat manage risk in 2012?
KOOHEJI: A proactive methodology is necessary when it comes to risk management, and we have now developed a three-stage approach: risk identification and assessment; risk mitigation and control; and risk monitoring and reporting. Over the course of 2012, we took a number of concrete steps in areas such as liquidity management, debt reduction and strategy, and these have resulted in an improvement of our risk profile.
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