Standard Chartered Makes First Private Equity Investment in Saudi

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Standard Chartered Private Equity (SCPE) announced the acquisition of a minority stake in Construction Products Holding Company (CPC) through an equity investment of $75m. CPC is Saudi Arabia’s largest manufacturer and provider of building materials and a subsidiary of the Saudi Bin Laden Group (SBG).

This is the first investment in Saudi Arabia for SCPE. Standard Chartered Private Equity is committed to investing in successful Saudi businesses and is actively seeking opportunities across the Kingdom and the rest of the Middle East. SCPE invests in companies across sectors with proven cash flows, backed by best in class management teams in flexible private equity or mezzanine structures.

SCPE will be granted a board seat and will provide strategic insight on CPC’s capital structure and expansion into new markets.

Taimoor Labib, Managing Director and Regional Head of MENA Private Equity at SCPE, said, “CPC is an exemplary blue chip company and we are delighted that they have chosen us as their long term partner. They enjoy a dominant market share in the Saudi Arabian building materials construction market and are led by one of the strongest management teams in the Kingdom. The company has a long track record of growth and returns to shareholders and is well positioned to continue to be the leader in the Saudi Arabian market and also achieve its regional growth plans.”

Mu’taz Sawwaf, CEO CPC, said, “The Saudi Bin Laden Group is excited about its new partnership with Standard Chartered Bank and its top notch Private Equity group. CPC, as the back bone of the Saudi Bin Laden Group, is the largest integrated supplier of building materials in the Kingdom of Saudi Arabia and the Middle East. We look forward to SCPE’s partnership as we experience robust growth in our existing footprint and in new markets.”

Since 2002, Standard Chartered, through its Principal Finance Group, has invested approximately $3.5bn in over 65 companies throughout Asia, Africa and the Middle East. The investments aim to provide growth capital to enable development and expansion, buy outs and acquisitions, and balance sheet restructuring. The Principal Finance Group invests directly in companies through Private Equity, Infrastructure, Real Estate and Distressed Investments.

Opec member Saudi Arabia is seen as an attractive market by large international private equity firms. Carlyle said in April it expects to complete a deal in the kingdom by the end of the year. Another US firm KKR received a license from the regulator to conduct business in Saudi in June.

About CPC:

CPC, a subsidiary of the Saudi Bin Laden Group, was officially established in 2007. It provides its clients with solutions for up to 80% of all their construction needs, including marble and granite, precast, ready-mix concrete, adhesives, paints, aluminium and glass, steel, wood products, electric cables along with installation services and transport and logistics services, throughout Saudi Arabia and uses the proceeds for expansion purposes.

Sources: Ameinfo, dt.bh

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