Carlyle plans $1bn push into Mideast By Lina Saigol Financial Times, 21:15 BST Jul 30, 2006
Carlyle Group, the US buy-out fund, is planning an investment push into the Middle East with a dedicated fund of up to $1bn, in spite of the mounting spiral of violence there. It has hired Korn Ferry, the executive headhunter, to recruit a senior fund manager to spearhead the expansion - the first of its kind in the region. Carlyle hopes to launch the fund before the end of the year and is thought to be looking at creating a hybrid private equity fund that would also allow it to put money into listed securities in the Middle East. It will also look at investing in fledgling companies and taking controlling stakes in more mature enterprises. The fund is expected to focus on investments in the six-nation Gulf Co-operation Council - which includes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates - as well as North Africa. International private equity groups have been keen to invest in the region to expand their opportunities to gain access to the huge sums pouring into the Gulf because of record oil prices. The sharp correction of the region's equity markets in February, which saw valuations fall dramatically after triple-digit percentage growth in the previous 18 months, has also made it more attractive to private equity. Until recently private equity funds operating out of the oil-rich Gulf states tended to target firms in Europe or the US. But in June a consortium of US groups including Citigroup and Capital International agreed to buy a 93 per cent stake in Egypt's Amoun pharmaceuticals for about $451m. However, Carlyle's efforts to expand into emerging markets have not always been a success. Last year, it abandoned plans to raise a $300m fund dedicated to Russian investments after saying that the investment climate in Russia did not warrant a dedicated team. Carlyle already has an extensive network of Arab investors and connections across the region. This once included the Saudi Arabian Bin Laden family, but in the wake of the September 11 attacks Carlyle severed its investment ties with them. Jayson Funke Graduate School of Geography Clark University 950 Main Street Worcester, MA 01610
