News at Bosicor |
|
Abraaj Capital buys 40 percent stake in Bosicor companies.
|
| |
Thursday, February 28, 2008
|
|
|
| |
Short Description:
Abraaj Capital buys 40 percent stake in Bosicor, companies to become Pakistan’s leading integrated refining and petrochemicals group.
• Investment in Bosicor to support country’s demand for petroleum products and byproducts.
• Bosicor to establish oil refinery and petrochemical production facility, making it Pakistan’s largest refiner and producer.
• Largest private equity investment in Pakistan.
|
|
|
| |
News Detail:
Dubai, February 28, 2008: Bosicor, with a vision and expertise in refining/petrochemicals/product marketing and Abraaj Capital, the premier investment firm specializing in private equity investment in the Middle East, North Africa and South Asia (MENASA) region, announced today signing of Agreement for buying a stake in the holding company of Bosicor Group, (Bosicor). This stake will provide Abraaj with a 40 per cent shareholding in Bosicor’s two group companies; Bosicor Oil Pakistan Limited and Bosicor Chemical Pakistan Limited. Abraaj will also purchase a minority stake in Bosicor Pakistan Limited (BPL), equivalent to the shares acquired through a mandatory tender offer to be made to the other shareholders in BPL.
The Group’s subsidiary, BPL, the fifth-largest oil refinery in Pakistan currently operates with a rated capacity of 30,000 barrels per day (bpd) and a market share of 12 per cent. Established in 1995, BPL is listed on all the three stock exchanges of the country.
The investment in Bosicor was made through Abraaj Capital’s US$2 billion Infrastructure and Growth Capital Fund (IGCF), which seeks to address the infrastructure requirements of the MENASA region in various sectors, including transportation, education, healthcare, water, manufacturing, petrochemicals, and power and utilities.
The investment will fund the establishment of a petrochemical plant and a refining unit that will provide the Bosicor group with an initial aggregate refining capacity of 145,000 bpd and create an integrated platform that operates across the full value chain in the oil sector. Further investments in related infrastructure are planned over the next few years with a view to creating Pakistan’s first global scale refining, petrochemicals and energy conglomerate.
With demand from transportation, power and manufacturing sectors increasing due to thriving economic activity in Pakistan, including annual GDP growth of up to 8 per cent, the country’s total demand for petroleum products is forecast to rise at a five-year compound annual growth rate of 5 per cent until at least 2010. Pakistan currently imports over 50 per cent of its high-speed diesel requirement and almost 100 per cent of the petrochemical products.
“This investment in the future of Pakistan – one of many made by Abraaj Capital and the first by IGCF – will greatly enhance the country’s ability to fuel its ongoing economic expansion,” said Arif Naqvi, Vice Chairman and Group Chief Executive Officer, Abraaj Capital. “Led by an expert management team and benefiting from Pakistan’s extremely competitive labour and production costs, Bosicor is poised to become the clear leader in this key sector.
“This partnership with Abraaj Capital, which provides us with both additional capital and global management best practices, will greatly enhance our ability to contribute to Pakistan’s future growth,” said Amir Abbassciy, Chairman - Bosicor. “By addressing the current supply-demand imbalance in the national energy sector through the establishment of a new oil refinery and petrochemical production facility, Bosicor will help to ensure that Pakistan continues to realize the promise of sustained economic expansion.”
“BPL is active in the production, marketing and sale of petroleum products. The company started its operation with capital of Rs. 1,105.066 Million and assets of Rs. 2,248.063 million. This now stands at Rs. 3,921.044 million and Rs. 7,109.700 million respectively. The company will use Country’s first Single Buoy Mooring (SBM) which is being installed near the coastal belt of Balouchistan in close proximity of the refinery. The company is in process of enhancing its storage capacity by 126,000 metric tons.
He added that this venture will enable BCL to contribute its existing capital, vision and expertise in refining/petrochemicals/product marketing, while Abraaj will contribute additional capital and global management best practices. Together these resources will set us on a much higher trajectory of growth then what our industry has seen.”
|
|
GO BACK TO NEWS LIST |
