Diversified conglomerate Dubai Investments (DI) will be spending up to Dh30 million on expanding existing facilities and building warehouses for its subsidiary pharmaceuticals manufacturer Globalpharma.
DI recently acquired 100 per cent ownership of the company, having previously held a 65 per cent stake with the other 35 per cent belonging to Indian healthcare company Kopran.
"We are looking at expansion for the company," said Khalid Kalban, Managing Director and CEO of DI. "We are spending between Dh25m and Dh30m on expanding facilities, building warehouses and managing the existing facilities.
"Investment in the manufacturing industry always fetches a return of about 30 per cent, which is attractive in today's market."
The group is also planning to use its private equity subsidiary M'Sharie to expand into the Saudi market. DI divested about 40 per cent of equity in M'Sharie to select strategic partners through a private placement last year. M'Sharie is valued at Dh1 billion and has interests in 16 companies operating in diversified businesses – 14 are majority or fully-owned subsidiaries while the other two are joint ventures.
"The Saudi market is strong and a lot of our subsidiary companies sell products there," said Kalban. "The UAE market has slowed down so we are looking at acquisitions and expansion in other markets, especially Saudi Arabia and Qatar. If an opportunity makes economic sense then we will invest in it regardless of the industry."
DI has instructed all its subsidiaries to enhance their export potential, especially Emirates Building System (EBS) and Emirates Float Glass (EFG).
EBS has secured land in Qatar and plans to build a factory there. EFG is investing Dh1.1bn to diversify its product range and intends to enter the solar panel and specialised glass sectors and cater to entire Middle East.
"We are trying hard to keep a balance between maintaining high liquidity without affecting any of our expansion plans. We have to create new markets since we have the expertise now – all our subsidiary companies have their own market expertise," Kalban added.
DI is holding talks with government officials in Amman on managing and marketing an investment park in Jordan similar to the Dubai Investments Park. A team from DI is to travel to Jordan to finalise the deal and officials from EBS will be part of the delegation.
"If the negotiations succeed we will be involved in managing and marketing the project and bringing in investors," he said.
Kalban said there was a good market for such a project in Jordan since the location was central to Iraq, Syria and Saudi Arabia. "The infrastructure on the site has been developed and we are negotiating with the Jordanian Government," he said.
DI has been approached by two North African countries for building similar parks. Kalban did not name the countries. "The Dubai Investments Park is a unique offering and there is nothing like it currently in the region. We are planning to have a Fujairah investments park similar to the Dubai Investments Park model."
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