CEO Predictions 2015: Mahmood Al Koheji, CEO, Mumtalakat

The year 2014 was an important one for Mumtalakat, Bahrain and the GCC. Trading and investment conditions in the kingdom and the wider region remained healthy, despite global economic uncertainties and geopolitical challenges.

The region and Bahrain’s proximity to Asia and Africa ensured it maintained its position as an important trade crossroads and it remained a popular destination for international businesses to establish offices.

Foreign Direct Investment (FDI) flows remain strong as investors seek exposure to the GCC and the surrounding markets and Mumtalakat has partnered with a number over the course of this year.

Mumtalakat partnered with Fajr Capital and Blackstone to acquire GEMS Education, which operates a global network of over fifty schools in nineteen markets.

In addition to this, we recently acquired the leading US software and services provider, PRO Unlimited, in partnership with Investcorp, and acquired a 15 per cent stake in the global alternative investment manager Arcapita. These companies demonstrate strong commercial potential and we expect them to deliver healthy long-term returns.

This year we also announced our 2013 results, which saw an increase in gross profits of 135 per cent, largely due to the improved performance of portfolio companies, including Gulf Air.

Mumtalakat built on these successes in 2014 and our portfolio has been performing well. We have also continued to promote transparency and good governance across our portfolio companies, within Mumtalakat and across the region.

In line with this, we launched our first International Directors Programme in 2014, in partnership with INSEAD.

The program provides guidance on corporate governance and transparency for appointed directors to the boards of Mumtalakat’s portfolio companies.

We release our annual report and annual financial results every year, to give all stakeholders deep insight into
our operations.

We also run lunch and learn sessions, which are a forum for our stakeholders to pose questions directly to management about Mumtalakat and our portfolio.

These initiatives have contributed to Mumtalakat scoring nine out of ten on the Sovereign Wealth Fund Institute’s Linaburg-Maduell Transparency Index in 2014, which is a recognised barometer for sovereign wealth fund governance and transparency.

Looking ahead to 2015, I believe that the outlook for sovereign wealth funds around the world is bright.

As with many private sector organisations, the importance of transparency and good corporate governance is becoming increasingly important to ensure positive engagement with all stakeholders, including government entities, the media, the general public and wider business community.

Those that take the initiative will gain stakeholder confidence, improve their reputation and earn their license to operate and, as such, I expect to see more being done in these areas over the coming year.

At Mumtalakat, we have made transparency and accountability business priorities. These will continue to be areas of focus for us as we grow and manage our portfolio, making investments and divestments as and when appropriate.

We also have the appetite and the capital available to invest in new assets and will consider those that make commercial sense, play to our points of strength and complement our portfolio.