NORTH AFRICA HOLDING COMPANY Unlocking Potential Creating Value CORPORATE PRESENTATION December 2010 1
Agenda North Africa Holding Company Why investing in North Africa KIPCO Group 2
Snapshot on North Africa Holding Company Founded in September 2006, North Africa Holding (NorAH) is a Kuwait based investment company focused on investment opportunities in the economies of Morocco, Algeria, Tunisia, Libya and Egypt. Driven by a clearly defined vision and investment strategy, NorAH aims to contribute to the sustainable development of North African economies by investing in local companies which have demonstrated the ability, or have the potential, to deliver real value. With an initial capital of US$180 million (KD50 million), NorAH is amongst the largest panregional investment companies focused on North African markets. Since its establishment, NorAH has made robust progress in establishing its presence across North Africa, developing strong relationships with both local and international partners and trusted advisors. NorAH has a solid track record and proprietary networks through its experienced senior management team and its strong relationships with its shareholders including the prestigious Kuwait based holding group KIPCO. 3
Vision, Mission and Values Contribute to the sustainable development of North African economies by building market-leading businesses in the region Vision Emerge as the premier investment holding company focusing on the North Africa region. We draw on our team experience and the network of our principal investors to generate superior returns for our stakeholders, thereby contributing to the sustainable development of North African economies. Our investment team shares common values and adheres to the highest ethical standards. Most importantly, our growing North African presence is built upon a philosophy that embraces the cultures of the region in which we operate. 4
Investment Strategy Focus on expansion finance investments Our chosen focus areas are typically in a rapid development phase. We aim to support our investments through to maturity. Focus on North Africa Our chosen countries of focus are Morocco, Algeria, Tunisia, Libya and Egypt as we see long term development potential across the North African economies. Generalist / Opportunistic approach We have a generalist approach, even though we have identified hot sectors including financial services and insurance, real estate and construction, industrial and engineering, oil and gas, healthcare, and hospitality. NorAH adopts a relatively opportunistic and pragmatic approach to its investments at this time. 5
Investment Approach Approach Contribution Our investment approach is based on partnering with local and regional North African companies. We look to partner with : - High quality local and international businesses which have demonstrated the ability, or have the potential, to deliver real long term value - Companies with superior management teams NorAH s contribution to investee companies aims at: - providing support in achieving their full potential; - enabling them to become more competitive; - creating dominant businesses on both a regional and global scale - Other financial investors Through the partnering approach, we seek to mobilize and channel all the resources required (financial and commercial) to unlock potential capital and create value. 6
Investment Portfolio In 2007, NorAH acquired 51% stake in the leading Tunisian Electro-Mechanical Equipment Company SACEM, which produces electric transformers. The company is planning to increase its turnover by 25 million Dinars (14 million Euro) before considering its possible listing on the Stock Exchange. In September 2008, NorAH acquired a majority stake in the well known professional training services company EFPM - Pigier Algeria, a master franchise of the well established Pigier France since 1850. The company provides professional training services for individuals as well as customized training programs for companies tailored to the growing needs of businesses established in Algeria. In May 2009, NorAH acquired a majority stake in the prestigious 170mn Assoufid real estate project in Marrakech.The new co-operation represents a significant milestone in NorAH s expansion plans into the Maghreb, through the development of an exclusive, high end residential, hotel and golf venue in Marrakech. 7
Investment Portfolio contd. In September 2010, NorAH acquired 50% stake in Kandil Glass, one of Egypt s leading manufacturers of glass containers. The investment will allow Kandil Glass to finance the construction of a new production facility. In December 2010, NorAH acquired a Majority stake in Egyptian International Medical Center (EIMC) and its affiliate, EIMC United Pharmaceuticals (EUP). EIMC is one of Egypt s leading pharmaceutical distributors that focus on oncology, intensive care products and blood derivatives and EUP is a pioneer in manufacturing a wide range of oncology and intensive care products. 8
Senior Team H.E. Abdullah Yaccoub Al Bisharah. Chairman Former Kuwait Ambassador to the UN & GCC and current Vice Chairman of KIPCO. Masoud Hayat, Chairman Exec. Committee NorAH Formerly Chairman of KAMCO, the $6 Billion asset management arm of Kuwaiti Special Projects Company (KIPCO). Mr. Hayat in the past was Managing Director of United Gulf Bank, the investment banking arm of KIPCO. Emad Al-Saleh. Chief Executive Officer Formerly Deputy Director for Agility Logistics, a leading global logistics provider, where he oversaw acquisitions that enabled the company to grow from $400 m to $4.6 bn in revenue in 4 years. GianMauro Chiaranda. Senior Vice President - Investments Former Director, Private Equity department of Banca Intesa Sanpaolo, Milan. In his 9 year tenure he led various stage investment transactions (from greenfield projects to secondary buyouts); INSEAD MBA. 9
Agenda North Africa Holding Company Why investing in North Africa KIPCO Group 10
North Africa: Fast Growing Market Dynamics The North Africa region is home to over 160 million people. This equates to 65% of the entire MENA region (Middle East and North Africa) population. North African countries have some of the fastest growing economies in the world. Viewed as emerging markets, they have grown at a rate of over 5% p.a. Average GDP per capita for the North Africa region is twice that of the developing world as a whole. This places the region above any other emerging economic area. Typically, North African economies are still maturing, but play an increasing role in the economic affairs of Europe, Africa and the Middle East. There is continued stability in the region, supported by major governmental liberalization efforts. For example, many markets are opening up to free trade and competing freely in foreign markets. The need for increased capital to support growing businesses and new ventures is large. Only now is significant capital being focused on the MENA region as a whole, and North Africa specifically. 11
North African Countries differ in terms of Size and Growth North Africa: Population, GDP and Real GDP Growth in 2010 (f casts) 2010 GDP (US $ billions) 2010 Real GDP growth (y-o-y % change) Source : Economic Intelligence Unit Country Forecast March 2010 12
GDP Growth: after a stop in 2009 it is forecast to be back on track North Africa's Economic Figures 2008 2009 2010 (e) 2011 (f) Tunisia Morocco Libya Egypt Algeria GDP (US$ bn) 174.5 178.7 185.5 192.9 Population (m) 33.8 34.2 34.6 35.0 GDP per capita (US$) 5,163 5,225 5,361 5,511 GDP (US$ bn) 196.7 205.9 216.8 228.8 Population (m) 77 79 80 82 GDP per capita (US$) 2,554 2,607 2,710 2,790 GDP (US$ bn) 95.2 68.837 79.194 81.397 Population (m) 6.3 6.4 6.5 6.7 GDP per capita (US$) 15,118 10,756 12,184 12,149 GDP (US$ bn) 88.9 91.4 94.8 99.2 Population (m) 31.6 31.9 32.3 32.7 GDP per capita (US$) 2.813 2.865 2.935 3.034 GDP (US$ bn) 38.9 40.1 41.6 43.6 Population (m) 10.4 10.5 10.7 10.8 GDP per capita (US$) 3,740 3,820 3,891 4,040 (e): Estimate; (f): Forecast Sources: Economic Intelligence Unit March 2010. International Monetary Fund March 2010 13
North African Market Landscape is rapidly changing The North African market is still developing rapidly. It has however reached a level of maturity to stimulate healthy demand patterns across most economic sectors driven by both businesses and consumers. Although demand is strong and growing, free market forces have been interrupted through: A long history of governmental intervention; State subsidies; Price controls These factors, combined with subsequent privatization initiatives, have created extreme supply shortages in a number of goods and services. North Africa population in general are experiencing an unprecedented explosion in discretionary income on a purchasing power parity (PPP) basis. This purchasing power is on par with the top emerging market economies in Asia, Eastern Europe, Latin America, and Russia. 14
Agenda North Africa Holding Company Why investing in North Africa KIPCO Group 15
KIPCO Group is a large industrial holding company MENA region focused operating holding company, based in Kuwait Over 18 years track record of creating, acquiring, building and selling businesses Primary focus on banking, insurance and media sectors Rated by: Moody s (Baa2/P-3) and S&P (BBB-/A3) One of the most actively traded stocks on KSE Group employees: over 8,000 First 100% private owned company in region to obtain investment grade rating from S&P First non-banking institution in GCC to set up a US$2 billion Euro Medium Term Note (EMTN) programme 16
KIPCO Group has over US$ 25 bn in Assets Under Management KIPCO Group comprises over 60 companies in 5 vertical sectors Financial Services Real Estate Industrial Total Assets US$ 18,214 Million Total Assets US$ 1,778 Million Total Assets US$ 1,560 Million Total Revenue US$ 1,475 Million Total Revenue US$ 114 Million Total Revenue US$ 294 Million Investment 27 Companies Investment 12 Companies Investment 6 Companies Media Others 1 Total Assets US$ 1,731 Million Total Assets US$ 906 Million Total Revenue US$ 288 Million Total Revenue US$ 177 Million Investment 3 Companies Investment 13 Companies Total consolidated assets of KIPCO Group: US$19 billion Total AUM of KIPCO Group 2 : US$25 billion Notes: 1. Includes companies in healthcare, management services and other sectors 2. AUM of KIPCO group represents the total assets of KIPCO Parent and its major subsidiaries & associates on 100% basis, excluding third party assets managed by the group. Industry wise break-up given above represents the AUM 3. Information presented as on Dec 31, 2009 17
KIPCO Group has a strong and diversified presence across the MENA region MENA Country Bahrain Kuwait Oman GCC Qatar KSA UAE Algeria Egypt Jordan Lebanon Syria Non-GCC Tunisia Iraq Palestine Libya Morocco Existing operations AM/ IB CB Activities CB IN ME RE IND OT Commercial banking AMIB Multi-sector Presence Across the MENA Region Morocco GCC MENA ex GCC Algeria Tunisia Libya Syria Lebanon Palestine Iraq Jordan Egypt Asset management and investment banking Saudi Arabia IN Kuwait Bahrain Qatar U.A.E Yemen Insurance Oman ME Media RE Real Estate IND Industrial OT Others
Dar Al Awadi, 10 th Floor. Ahmad Al Jaber Street, Sharq P.O. Box 1246 Dasman 15463, Kuwait Tel: (+965) 2232 2322 Fax: (+965) 2232 2331 www.northafricaholding.com 19