Bahraini private equity firm invests in UAE utility Utico

Asma Capital signed the deal with Utico for a 'significant minority stake' in its water business, according to the company.

A Bahrain-based private equity firm has invested US$147million in Utico, the UAE’s only private utility company.

Based in Ras Al Khaimah, Utico is expanding its infrastructure assets in water, power, transmission and distribution, storage, billing and collection businesses. It is building a water desalination plant in Ras Al Khaimah and upgrading two other desalination plants.

Asma Capital, which is owned by sovereign institutions including Islamic Development Bank (IDB), Saudi Arabia’s Public Investment Fund (PIF) and Public Pension Agency (PPA), the ministry of finance of Bahrain and the ministry of finance of Brunei, signed the deal with Utico for a “significant minority stake” in its water business, according to the company.

Utico is one of 27 divisions of the Abu Dhabi holding company Ghantoot Group, which has interests in infrastructure, manufacturing, real estate and hotels.

Utico was not immediately available for comment.

The deal was done through IDB Infrastructure Fund II, which is managed by Asma Capital. The transaction is expected to be complete in the first quarter of this year. Shareholders of Asma Capital are also investors in the IDB Infrastructure Fund II.

Asma Capital said it expects to increase its investment with Utico in other projects.

The announcement comes three days after the PIF denied in the official Saudi Press Agency that it was buying a stake in Utico.

In line with the country’s growing population, water and electricity demand in the UAE has been on the rise for the past few years. Abu Dhabi Water and Electricity Company is constructing the Mirfa power and water desalination plant that is expected to open in the second quarter. It is to have a capacity of 52.5 MIGD (million imperial gallons per day).

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