Waha Capital looks at Middle East and African assets with Dh1bn war chest

The Abu Dhabi-listed investment firm is looking at sectors such as education, health care, infrastructure and energy to deploy its money, according to its chief executive Salem Al Noaimi.

Waha Capital chief executive Salem Al Noaimi said they could also raise stakes in existing assets if there was an 'opportunity to invest'. Reem Mohammed / The National

Waha Capital has Dh1 billion in firepower to invest in assets in the Middle East and Africa as relatively low valuations present investment opportunities, according to its chief executive.

The Abu Dhabi-listed investment firm is looking at sectors such as education, health care, infrastructure and energy to deploy its money, said Salem Al Noaimi.

“This is the time where people who look for value and long- term growth like Waha Capital deploy capital and grow the business with much more interest in valuations as opposed to a heated market,” said Mr Al Noaimi.

Waha Capital recently completed the refinancing of a US$500 million upsized five-year credit facility, which will help to fuel growth for the company. The new loan replaces a $375m revolving credit facility secured in 2014.

Waha Capital’s main assets include stakes in New York-listed aircraft leasing firm AerCap Holdings, consumer finance business Dunia Group and oil services company National Petroleum Services.

Abu Dhabi investment firm Mubadala is the single largest investor in Waha Capital, with a 14.3 per cent stake.

The company is planning to focus its efforts on boosting its energy, power and infrastructure investments in the Middle East and Africa region, taking advantage of lower valuations of these assets.

Waha Capital is also keen on snapping up assets in education and health care in the UAE, although the company is looking at some health care investment opportunities in the Arabian Gulf.

Waha Capital could also raise stakes in existing assets, Mr Al Noaimi added.

“If we see an opportunity to invest in our portfolio companies at interesting valuations, we will look at them,” he said.

As for its asset management business, Waha Capital is aiming to increase the participation of third-party investors in its funds in the next three to five years.

This year it opened two of its five funds – fixed income and public equities funds – to third-party investors. The company is targeting institutional investors and high net worth individuals for its three other funds.

“We plan to open them to third party [investors] when they are ready,” said Mr Al Naoimi. “It depends on how strong the appetite is from the market.”

Currently the company’s assets under management stand at Dh2.6 billion.

The company’s second-quarter net profit attributable to equity holders plunged 22 per cent to Dh130m as income from certain investments dropped and costs rose.

Tough macroeconomic conditions contributed to the drop in profit, said Mr Al Noaimi. While the return on equity in the past three to five years has been more than 15 per cent, so far this year it is 7.5 per cent, he added.

“In the last couple of years the portfolio has significantly outperformed,” said Mr Al Noaimi. “This year it has outperformed less.”

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