KIPCO
 | |
| Public | |
| Industry | Holding company |
| Founded | 2 August 1975 as Kuwait Investment Projects Company |
| Headquarters |
KIPCO Tower, Khalid Bin Al Waleed Street, Sharq, Kuwait City |
Area served | GCC & MENA Region |
Key people |
Sheikh Hamad Sabah Al Ahmad Al Sabah (Chairman) Faisal Hamad Al Ayyar (Vice Chairman) |
| Products | Commercial Banking, AMIB, Insurance, Real estate, Industrial, Investment, Media & Technology |
| Revenue |
 US$2,047 million (2015)[1] |
|
US$175 million (2015)[1] | |
| Total assets |
US$32 billion (2015)[1] |
| Total equity |
US$4.2 billion (2015)[1] |
Number of employees | 12000[2] |
| Website | 29°22′33″N 47°59′11″E / 29.37583°N 47.98639°ECoordinates: 29°22′33″N 47°59′11″E / 29.37583°N 47.98639°E |
Kuwait Projects Company (Holding), known as KIPCO, is an investment holding company in the Middle East and North Africa (MENA) region, with consolidated assets of US$33.2 billion as of 30 June 2016. The Group has significant ownership interests in a portfolio of over 60 companies operating across 24 countries.The group's main business sectors are financial services, media, real estate and manufacturing. Through its core companies, subsidiaries and affiliates, KIPCO also has interests in the education and medical sectors.[3]
History
KIPCO was incorporated on 2 August 1975 under Article 94 of the Kuwaiti Commercial Companies Code, Law No. 15 1960.[4] Since incorporation, the company has grown substantially and made significant investments in a diversified portfolio of companies operating throughout the GCC and the wider MENA region.
Key Milestones
| 1988 | Acquisition of United Gulf Bank (UGB)[5] |
| 1995 | Acquisition of stake in United Real Estate Company (URC)[6] |
| 1995 | Acquisition of stake in Burgan Bank |
| 1995 | Formation of Gulf DTH (Showtime) |
| 1996 | Acquisition of stake in Gulf Insurance Company (GIC) – now Gulf Insurance Group[7] |
| 1996 | Acquisition of United Industries Company (UIC) |
| 1996 | Acquisition of SADAFCO - Saudia Dairy and Foodstuff Company - by UIC |
| 1998 | Formation of KAMCI – KIPCO Asset Management Company[8] |
| 1999 | Acquisition of stake in Wataniya Telecom[9] |
| 2006 | Establishment of US$2 billion EMTN programme[10] |
| 2007 | Sale of Wataniya Telecom |
| 2009 | Merger of Showtime and Orbit to create OSN[11] |
| 2009 | Completion of a 7-year US$500 million bond issue under EMTN programme[12] |
| 2010 | Completion of a 7-year US$500 million bond issue under EMTN programme[13] |
| 2010 | Sale of 39.2% stake in GIC to Fairfax[14] |
| 2010 | KIPCO acquires 34% direct stake in URC by subscribing to rights issue in Dec’10[15] |
| 2010 | Acquisition of 40.3% stake in UIC, 28.4% during rights issue and 11.9% from KAMCO in Sep’10[16] |
| 2012 | Burgan bank acquires 99.3% in Eurobank Tekfen (rebranded as Burgan Bank – Turkey)[17] |
| 2013 | OSN acquires 100% stake in Pehla (region’s largest provider of South Asian pay TV content)[18] |
| 2013 | Burgan Bank & UGB jointly acquired ~49% stake in Fimbank, Malta[19] |
| 2013 | UIC purchases additional 10.8% stake in Qurain Petrochemical Industries Company(QPIC)[20] |
| 2013 | UIC divests 29% stake in SADAFCO for KD66 mn[21] |
| 2014 | Completion of a 5-year US$500 million bond issue under EMTN programme[22] |
| 2014 | UIC divests remaining 11% stake in SADAFCO for KD25mn |
| 2014 | Burgan Bank completed the issuance of USD500mn perpetual bond[23] |
| 2014 | Burgan Bank successfully raised capital worth KD102.6 million through a rights issue[24] |
| 2015 | OSN secures second Syndicated Financing Facility for US$400 million[25] |
| 2015 | KIPCO through its subsidiary acquired 51.2% stake in Jordan Kuwait Bank from Burgan Bank[26] |
| 2016 | KIPCO repays KD 80 million bond[27] |
| 2016 | Completion of a 7-year US$500 million bond issue under EMTN programme [28] |
| 2016 | Burgan Bank completed the issuance of a KWD 100 million Tier 2 Capital issuance [29] |
Corporate Governance
KIPCO is a strong supporter of promoting transparency of operations, thereby launching its annual Shafafiyah (transparency) investors’ forum in 2004.[30] In this forum, KIPCO and its Group companies shed light on ethical and responsible decision making methods, while safeguarding the integrity of financial reporting. KIPCO has made timely and balanced disclosures, while efficiently recognising and managing risk.
Board of Directors[30]
| Name | Position |
|---|---|
| Sheikh Hamad Sabah Al Ahmad Al Sabah | Chairman |
| Faisal Hamad Al Ayyar | Vice Chairman |
| Abdullah Yacoub Bishara | Board Director |
| Sheikh Abdullah Nasser Sabah Al Ahmad Al Sabah | Board Director |
| Sheikh Sabah Nasser Sabah Al Ahmad Al Sabah | Board Director |
Executive Management[30]
| Name | Position |
|---|---|
| Faisal Hamad Al Ayyar | Vice Chairman (Executive) |
| Samer Subhi Khanachet | Group Chief Operating Officer |
| Masaud Mahmoud Jowhar Hayat | Chief Executive Officer, Banking |
| Tariq Mohammad Abdulsalam | Chief Executive Officer, Investments |
| Pinak Maitra | Group Chief Financial Officer |
| Khaled Abdul Jabbar Al Sharrad | Group Chief HR and Administration Officer |
| Declan Sawey | Group Treasurer |
| Mohsen Ali Husain | Group Chief Audit Executive |
| Mazen Isam Hawwa | Group Senior Vice President, Finance and Operations |
| Robert Drolet | Senior Vice President, Technology and Media |
| Adel Jassem Al Waqayan | Treasurer |
| Osama Talat Al-Ghoussein | Senior Vice President, Banking |
| Eman Mohammad Al Awadhi | Group Communications Director |
| Iqbal Mohamed | President, United Gulf Management Inc. USA |
Shareholding Structure
KIPCO’s principal shareholder is Al Futtooh Holding Company (AFH), a Kuwaiti holding company owned by members of the Kuwaiti ruling family, with a direct holding of 44.7% as of 31 December 2015. The remainder of the shares are primarily held by institutions, equity funds, high-net-worth individuals and retail investors.
The following table sets out the percentage holdings of the Company’s shareholders as at 30 June 2016:[31]
| Percentage Holding | |
|---|---|
| Al Futtooh Holding Company K.S.C. (Closed) | 44.7 |
| Investment Companies & Other institutions | 39.9 |
| Investment Funds | 7.1 |
| High Net Worth Individuals & Retail Investors | 6.5 |
| Treasury shares (KIPCO Parent) | 1.8 |
Group Structure
The principal subsidiaries and associates of KIPCO are in the financial services and real estate sectors, and KIPCO also has a joint venture in the media sector. The remaining companies of the Group and its associates operate in the service and industrial sectors.
The table below sets out the KIPCO’s Principal Companies:
| Financial Services | Media | Real Estate | |||
|---|---|---|---|---|---|
| United Gulf Bank | Gulf Insurance Group | Burgan Bank | OSN | United Real Estate Company | |
| Geographic presence in MENA | 7 countries |
10 countries |
8 countries |
24 countries |
8 countries |
| Shareholding | 96.3% |
45.6% |
64.6% |
60.5% |
72.0% |
Principal Companies/ Key Subs and Associates[4]
- Burgan Bank: Burgan Bank is the 2nd largest conventional bank in Kuwait in terms of assets offering a full range of banking services to both retail and commercial customers. It operates under four divisions which are corporate banking, retail banking, private banking and investment banking and treasury.
- Panther Media Group (PMG): PMG is the largest digital satellite premium Pay TV operator in MENA region operating under the brand name "OSN". It offers exclusive Western and Arabic content and has exclusive contracts with all 8 major Hollywood studios. As at 30 June 2016, OSN had over one million subscribers.
- United Gulf Bank (UGB): UGB is a leading asset management and investment banking group, with operations spanning the MENA region. The bank engages primarily in asset and fund management, investment banking, private equity, and corporate finance.
- Gulf Insurance Group (GIG): GIG is the market leader in Kuwait (by GPW and Direct Premiums), Bahrain and Jordan (by GPW) and Egypt (by Technical profit) among the private sector. GIG's product portfolio includes marine, aviation, property, casualty, motor, life and health insurance.
- United Real Estate Company (URC): URC is the 3rd largest listed real estate player on KSE in terms of assets. URC is an integrated real estate company, which invests in, manages and develops real estate properties in Kuwait and within the MENA region.
- United Industries Company (UIC): UIC invests in the downstream industries sector in Kuwait and the GCC states and it operates a diversified portfolio of investments in the energy, food and basic industries sectors.
- Others: KIPCO directly or indirectly holds more than 20 companies which are engaged in other businesses. The major entities engaged in other businesses are Advance Technology Company, United Education Company, Kuwait United Consultancy Company, United Capital Transport Company etc.
Business Strategy
The key elements of the Group's strategy are to:[4]
- Leverage its position and reputation in the GCC and wider MENA regions to capture further growth in these regions
- Acquire, create, build and selectively sell businesses in sectors that capitalise on regional opportunities
- Exercise management control over businesses
- Maximise value from businesses with a medium-to long-term horizon
Regional Presence
The Group and its associates have a presence in the following countries in the MENA region:[4]
| Company | Present in |
|---|---|
| Burgan Bank | Kuwait, Iraq, Algeria, Tunisia, Turkey, Malta, Lebanon (branch of Bank of Baghdad) and Libya (representative office of Tunis International Bank) |
| United Gulf Bank | Bahrain, Kuwait, Tunisia, UAE, Syria, Malta and Morocco |
| Gulf Insurance Group | Kuwait, Saudi Arabia, Lebanon, Egypt, Syria, Jordan, Bahrain, UAE, Iraq and Algeria |
| Panther Media Group Ltd (PMG) | Licensed to operate in 24 countries in the MENA region; however, it currently operates in 19 countries |
| United Real Estate Company | Kuwait, Jordan, Egypt, Oman, Syria, UAE, and Lebanon |
| United Industries Company | Kuwait |
Credit Rating
| KIPCO[32] | S&P | Moody’s |
|---|---|---|
| Long Term | BBB- |
Baa3 |
| Short Term | A3 |
Prime 3 |
| Outlook | Stable |
Stable |
Corporate Social Responsibility
The Protégés Program[33]
The Protégés is a mentorship program designed to provide young people with opportunities to learn life and leadership skills, through combination of travel, lectures, group activities, challenges and games for around 6 weeks. Around 25 Protégés are selected based on a thorough screening process ensuring that they meet high standards of excellence. KIPCO is the strategic partner of the program and is supported by nine Group companies.
Dyslexia Campaign
Dyslexia Campaign is KIPCO's initiative for public awareness about Dyslexia.The campaign – which featured TV and press advertising to highlight the problems faced by those people suffering from dyslexia – was the first of its kind in the Gulf region.[34] In 2008 KIPCO won an award for the campaign on dyslexia at Kuwait's first Corporate Social Responsibility (CSR) Awards.[35]
References
- 1 2 3 4 KIPCO Financial Statements 2015, RNS Market News, 23 February 2016
- ↑ KIPCO Overview, KIPCO Website 15 April 2016
- ↑ "KIPCO - press release" Kuwait News Agency (KUNA) 27 July 2016
- 1 2 3 4 "EMTN Prospectus 2015" KIPCO Website 03 November 2015
- ↑ NBK Capital report, Arabtimesonline.com, 12 February 2014
- ↑ URC Prospectus, LSE 5 May 2007
- ↑ Global Research-Kuwait Global Investment House, April 2009
- ↑ KAMCO News Kuwait times, 04 June 2014
- ↑ KIPCO World, 2014
- ↑ "KIPCO share of Wataniya sale deal with QTEL finalized" Kuwait News Agency (KUNA), 13 March 2007
- ↑ "Showtime Arabia, Orbit announce TV merger" Business.com, 12 July 2009
- ↑ Global Research-GCC Global Investment House, November 2009
- ↑ "KIPCO completes US$500m bond issue" Investegate, 12 July 2010
- ↑ "Fairfax unit to buy 39% of Gulf Insurance Co." Businessinsurance.com, 20 September 2010
- ↑ "KIPCO raises stake in real estate firm URC" Arabianbusiness.com, 25 January 2011
- ↑ "Kipco boosts stake in United Industries" Gulfbase.com, 04 July 2010
- ↑ "Burgan Bank Concludes Purchase of Eurobank Tekfen" Bloomberg.com, 23 December 2012
- ↑ "OSN acquires Pehla" Khaleej Times, 27 August 2013
- ↑ "Kuwait's KIPCO takes majority stake in Malta's Fimbank" Reuters.com, 30 May 2010
- ↑ KIPCO News Gulfbankers.com, 01 April 2014
- ↑ "United Industries divests 29% of SADAFCO in special transaction" Mubasher.info, 05 November 2013
- ↑ "KIPCO successfully prices US$ 500 mn bond issue" RNS Market News, 03 Feb 2014
- ↑ "Burgan Bank issues USD500m additional Tier 1 capital" Zawya News, 24 September 2014
- ↑ "Rights issue by Burgan Bank" Banking Frontiers
- ↑ "OSN secures $400 million syndicated financing facility" Arab News, 8 September 2015
- ↑ "Kuwait's Burgan Bank sells majority stake in Jordanian bank to parent firm" Reuters, 30 December 2015
- ↑ "KIPCO repays KD 80 million bond" Ameinfo, 17 January 2016
- ↑ "KIPCO completes US$ 500 million bond issue despite challenging market conditions" Gulf News 24/7, 9 March 2016
- ↑ "Burgan Bank issues subordinated bonds worth KWD 100m" GULFBANKERS, 13 March 2016
- 1 2 3 KIPCO Annual Report-2014
- ↑ KIPCO Corporate Website retrieved 01 September, 2016
- ↑ Credit Rating KIPCO Website 09 November 2015
- ↑ "Proteges Third Generation officially launched in Kuwait" Kuwait Times, retrieved July 21, 2014
- ↑ "KIPCO Sponsors Dyslexia Awareness Campaign" PRWeb, September 10, 2007, retrieved July 21, 2014
- ↑ "KIPCO's Dyslexia Campaign Wins Corporate Social Responsibility Award" Zawya, Jan 23 2008, retrieved July 21, 2014