Former Malaysian Prime Minister Abdullah Badawi today revealed plans for a $500 million private equity fund focused on global opportunities in the halal industry.
The fund is expected to be raised in stages and the aim, through a “roll-up” strategy, is to acquire, convert (non-halal companies) and grow companies in the food and agri-business sectors so as to have global reach as well as offer a diverse range of high quality quick service restaurant (QSR) products and services.
“There have been global developments in halal awareness, standard and certification, manufacturing and trade in the last decade. It is now time to create strong investment opportunities to enable more participation in this important halal sector,” said Badawi at the launch of Azka Capital at the eighth World Halal Forum in Kuala Lumpur, Malaysia.
Azka Capital is a private equity advisory firm focused on halal industry initiatives. It has assembled a team which has a thorough understanding of the global halal food landscape including working with certifying industry bodies from 55 countries through its strategic partnership with the International Halal Integrity Alliance.
“Azka is advised by world-class practitioners from the halal food sector, and Shariah advisory services from Dar Al Shariah and Amanie Advisors and Mr Badawi is Chairman of its Advisory Board,” said Rushdi Siddiqui, Co-Founder and Managing Director Azka Capital.
The highly fragmented nature of the industry would benefit from a consolidated strategy while Azka’s proprietary access to deal flow makes it uniquely positioned to capitalise upon this opportunity,” he added.
Siddiqui went on to explain that food security has become an integral part of national security policy in part because many Muslim countries are net importers of food and generally do not control the supply chains and, hence, the integrity of their food.
“The recent scandals including horsemeat in Europe and, more alarmingly, the evidence of pork DNA in halal beef by the very multinational companies responsible for halal integrity should be unacceptable to all halal stakeholders. Paying lip service to food security is wholly inadequate. The Halal Opportunities Fund is the first opportunity for investors and policymakers to take concrete steps toward securing the integrity of their food supply,” he concluded.
Currently the Organisation of Islamic Cooperation (OIC) nations’ food imports exceed US$40 billion annually, an overwhelming majority of their consumption. That figure will doubtless increase substantially with current estimates forecasting that the global Muslim population is expected to increase from 1.6 billion at present to 2.2 billion by 2030.
Commenting on Shari’a compliance, Dr Nasser Saidi, Member of Azka Advsiory Board, Founder and President of Nasser Saidi & Associates and former Chief Economist of Dubai International Financial Center (DIFC) said: "Ethical, Shari'a compliant investors have typically relied on various 'filters' to weed out non-compliant publicly available investment opportunities. But these filters are not always reliable and cannot keep up with new opportunities and are typically limited to developed markets. There is a better way: direct equity investing in vetted industries and activities on an international basis. That is what is being offered to investors through the Halal Fund. This is major innovation in the ethical investment space.”