20th July 2011
Amman, 16 July 2011 - Jordan Dubai Capital (‘JD Capital’), an investment company based in Amman, has announced the sale of its 51% stake in Kingdom Electricity Company (KEC) for a total consideration of JD 50.0 million (approximately US$71m). KEC owns 100% of the Electricity Distribution Company (EDCO) and 55.4% of Irbid District Electricity Company (IDECO) both Jordanian Public Shareholding Companies that were privatized by the Government of Jordan in 2008. The purchaser is the Social Security Investment Fund of Jordan (‘SSIF’) who along with Dubai International Capital are the largest shareholders in JD Capital.
Commenting on the sale David Smoot, Chairman of Jordan Dubai Capital said: “This transaction is another example of JD Capital’s strategy for realizing value for its shareholders and for the Jordanian economy. A number of international companies had indicated their interest in KEC recognizing the strong growth prospects for Jordan’s power sector. However, the transaction was concluded with SSIF because we believe that SSIF shares our vision for the development of the Jordanian economy. The decision was reinforced by SSIF being a major shareholder in JD Capital.”
In turn, Ismail Tahboub, CEO of JD Capital, said: “Through this sale and the recent sale of Central Electricity Generating Company in Jordan to ACWA Power International, we have completed the divestment of all the major assets in our infrastructure portfolio and cemented JD Capital’s position as the regional leader in infrastructure investing with an unparalleled track record. We have proven that through a combination of diligent pre-acquisition planning and post-acquisition management, infrastructure investing can provide avenues for successful deployment of capital and realize superior risk adjusted returns. Throughout the three year period we have held KEC, JD Capital has successfully led the transition of EDCO and IDECO into successful, commercially-oriented, private companies and has substantially enhanced their operating performance. This has consequently increased the overall value and profitability of both companies; significantly reducing electricity loss rates, reducing theft and tampering and improving collections.”
Commenting on JD Capital’s investment outlook, Tahboub stated: “We will continue to focus on diversifying our investment portfolio and capitalizing on sound investment opportunities throughout the Kingdom”.
Commenting on the acquisition, Dr. Yaser Al-Adwan, Chairman of the Social Security Investment Fund (SSIF), said: “The Fund’s interest in both conventional and renewable power corresponds with our strategy to invest in quality assets that generate stable long term cash flows at acceptable levels of risk.”
Dr. Al-Adwan added that the Fund’s interest in the power sector dates back to 2007 when the Fund was involved in several bids to develop and expand projects in the electricity and renewable energy sector. “The Fund is currently the major shareholder in the Jordan Electric Power Company, and is one of the main investors in the Central Electricity Generating Company, in which we own a 9% share. Today’s acquisition makes the Fund the largest investor in the electricity distribution sector in the Kingdom.”
Referring to the Fund’s future directions in the energy sector, Dr. Al-Adwan said: “The Fund is reviewing the progress of potential alternative energy projects. At the same time it is studying opportunities in oil shale which could be a commercially viable source of energy in Jordan; a country which currently imports all of its petroleum needs. We are currently in discussions with qualified bidders on these projects regarding possible forms of partnership.”
KEC was established in 2006 and its shareholders include JD Capital, Kuwait-based Privatization Holding Company (PHC); and Jordan Kuwait Bank (JKB).
For media enquiries:
Rania M. El-Far
Corporate Communications Supervisor
Jordan Dubai Capital
+962 (6) 592 2900
Notes to editors:
Jordan Dubai Capital
Jordan Dubai Capital was established as an investment company intended to source and execute investment opportunities solely in Jordan. Jordan Dubai Capital’s investment scope includes; Privatisations, Infrastructure, Projects and Private Equity and Strategic Investments in Publicly Listed Companies. Other assets in the fund include; Kingdom Electricity Company which owns and manages two of three electricity distribution companies in Jordan that collectively cover over 500,000 consumers and 70% of the Kingdom’s geography Jordan Dubai Islamic Bank, which is Jordan’s fastest growing Shariah compliant banking institution; First Insurance, an Islamic insurer and; Jordan Dubai Properties; which is developing major real estate and hospitality and leisure projects throughout Jordan. Jordan Dubai Capital is owned by a group of investors including Dubai International Capital and the Jordan Social Security Corporation and a range of other prominent regional investors.
