09.20.2011
By Terry Flanagan

KIPCO Expands

Top sovereign wealth fund in the Middle East sits on the cutting edge of financial services and media and, establishes pension.

KIPCO, the Kuwait Holdings Company, has accumulated 19.6 billion in assets under management. In the MENA (Middle East, North Africa) region, the firm is notable listed sovereign corporate—betting on the rise of the region’s financial services sector, and media/telecom industry.

“KIPCO plays an active role in the development of these economies (in the MENA region),” said group chief financial officer, Pinak Maitra. “The region has strong demographic trends (a high proportion of the 350 million people within the region are under the age of 25), abundant natural resources and a low market penetration rate of key services–especially financial services.”

KIPCO owns four regional banks, known as the Burgan Bank Group. They include the Gulf Bank Algeria, Tunis International Bank, Jordan Kuwait Bank, and Bank of Baghdad.

In media/telecom, the firm is focusing on developing technology that will combat the region’s growing problem with media piracy.

Maitra noted that the MENA area is likely to see major growth for the foreseeable future, and believes business opportunities within the region are on par with markets such as India and China.

Most recently, the firm has added a pension public offering—a first for KIPCO. The offering has diversified its repertoire as a strict holdings company.

“The establishment of the Takaud Savings & Pensions company – the region’s first private pensions company – is a major achievement for KIPCO. Takaud will launch its product range in selected countries early next year,” Maitra said.

The firm’s ability to take on new investments comes from a recent extension of its debt profile, which recently has extended to 2020.

“KIPCO believes that the repayment of its debut $350 million five-year bond issued under its $2 billion Euro Medium Term Note bond program and the early repayment of a three year $300 million U.S. loan reflect its financial strength,” Maitra noted.

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