Gulf Capital and Amwal AlKhaleej, two leading Middle Eastern alternative investment firms, have completed the sale of their portfolio company, Maritime Industrial Services (MIS) to a regional trade buyer.

The MIS sale of 100 per cent of the company for $336 million to offshore industry developer Lamprell caps an almost five year holding period by both firms during which revenues and profits were increased by 203 per cent and 184 per cent respectively, a statement said.

“MIS represents a solid case study for the Middle Eastern private equity industry,” said Dr Karim El Solh, co-founder and chief executive officer of Gulf Capital.

“This is a good example of how private equity firms can add real value to their portfolio companies by growing operations, bringing in new management leadership, executing bolt-on acquisitions, launching regional and product expansions, paying down debt and boosting profitability ahead of consummating a successful sale to a trade buyer.”

“As the largest investor in MIS, Gulf Capital was proud to be associated with this Company and to contribute to its rapid growth and subsequent profitable sale.  We are confident that MIS will continue to grow and thrive under the stewardship and ownership of Lamprell,” he added.

Ammar Al Khudairy, managing partner of Amwal AlKhaleej, said: “The successful sale of the Company and our ability to generate such a level of returns despite the difficult economic environment and the unfavorable vintage year for the investment highlight the resilience and appeal of certain industries to private equity in our region.”

“Furthermore, this transaction is a good example of how two private equity firms supported by strong management teams and a supporting and active board, can harmoniously co-invest, grow and successfully structure an exit aligning the interest of all stakeholders.”

Richard Dallas, managing director of Private Equity at Gulf Capital, said: “Following the record profits announced in 2010, Gulf Capital and Amwal AlKhaleej in partnership with the MIS Board and Management initiated the approach and subsequent trade sale to Lamprell.”

“This transaction is a good example of how a strategic trade buyer can come in and make an offer to acquire the entire company at a substantial premium in order to benefit from increased synergies, higher market share and product expansion.  As the regional private equity industry matures, we expect further trade sales of portfolio companies to strategic trade buyers.”

Fadi Arbid, CEO of Amwal AlKhaleej, said: “We are pleased to announce the conclusion of our fruitful collaboration and work with Gulf Capital on our joint portfolio company, MIS, along with the companies’ original founders and its senior management.”

“This is the first exit of our second partnership, Amwal II that vindicates our investment discipline despite an unfavorable investment cycle for Private Equity, and demonstrates the resilience of our portfolio despite a challenging economic and now political environment. We are also confident that with the support of Lamprell, MIS will be better positioned to embark in its new development phase,” he concluded. – TradeArabia News Service