Bahrain’s Asma Capital owned by sovereign institutions including Islamic Development Bank (IDB), has signed a deal valued at $147 million in equity and project finance with UAE-based Utico, a top private full service utilities provider.

The deal will be completed in the first quarter 2017, a statement said.

The deal is for a stake in Utico’s water business is done through Asma Capital managed IDB Infrastructure Fund II which has entered into a binding agreement with Utico.

Asma Capital is based in Bahrain and licensed by the Central Bank of Bahrain. The shareholders of Asma Capital, who are also investors in the IDB Infrastructure Fund II, are sovereign institutions including Islamic Development Bank (IDB), Saudi Arabia’s Public Investment Fund (PIF) and Public Pension Agency (PPA), Ministry of Finance of Bahrain and Ministry of Finance of Brunei.

Asma Capital stated that it seeks to invest further with Utico in its other projects and businesses.

Utico stated that the deal was carried out after intense multi-party due diligence and negotiations resulting in the deal signature in late 2016. Ernst & Young, Hatch USA, ILFS, GU Advisory UAE, Latham and Watkins, Trowers and Hamlins and Taylor Wessing are advisors to the deal.

Utico is making significant investments in the UAE and expanding its infrastructure assets in water, power, transmission and distribution, storage, billing and collection.

Utico hopes to do more deals in the near future and propagate its model of development globally including Saudi Arabia and in over 80 countries, including IDB member countries. Its pro-consumer and pro-government development model will be attractive to many countries as successfully proven by Utico in the UAE.

Richard Menezes, Utico’s managing director stated that the Government of UAE has enabled Utico’s business model to develop and flourish resulting in this landmark investment. Its unique model of development has saved the governments billions of dirhams in capital expenditure and subsidies. The development model also improves the credit ratings of governments and government bodies with sustainable tariff systems.

Utico’s business model of enabling the governments to provide accessible potable water and power in the most economical and sustainable manner, promotes social and economic development without further burdening the governments or the consumer.

In the present lower oil price and tight budgets of many governments, Utico’s model of utilities development becomes even more relevant and sustainable. – TradeArabia News Service