Gulf Finance House announces plans to create regional steel giant

Gulf Finance House, the leading Islamic investment bank with a track record for innovation today announces plans to create HadeedMENA, a new steel producing company. Conceived by Gulf Finance House, HadeedMENA aims to plug the shortfall in domestic steel production in Middle East and North Africa. In a deal with an estimated end value of US$5 billion, GFH is partnering with strategic partners Emirates International Investment Company, Khaleej Development Company (KDC), Q-Invest, and First Energy Bank, and leading technical partners and market advisors MN Dastur and Gulf Organization for Industrial Consulting; all of whom have a strong reputation regionally and internationally. The project will deliver a capacity of 8 million tonnes of steel per annum in the next four years, and target to reach 12 million tonnes in the future, serving 15% of total regional needs and become one of the key steel producers in the MENA region.
It is estimated that the Middle East alone accounts for more than USD$ 2 trillion of investments in the construction and real estate sector as a result of the surplus created through high oil prices. Meanwhile, the MENA region consumes approximately 35.4 million tonnes (2006) of steel end products, although the region produces only around 24 Million Tonnes.
HadeedMENA will operate in a number of locations across Asia and Africa, serving both upstream and downstream requirements in the marketplace. Upstream production will be located in countries rich in iron ore and coal, while downstream activity will focus on countries with exceptionally high demand across the GCC and MENA region.

Gulf Finance House Chairman Esam Janahi commented: “We intend to differentiate ourselves by taking a ‘top to bottom’ approach to the value chain. It will focus both on upstream productions for steel billets as well as the downstream manufacturing for steel re-bars and structures. The company is currently in the final negotiation stages for a number of partnerships and acquisitions that we will be able to announce in the near future ”

“GCC economies realize that establishing new manufacturing and service capacity will allow them to be far more responsive to their long-term domestic needs. The creation of HadeedMENA is a perfect example of this approach. Instead of being dependent on steel imports, we will now be able to produce this essential product within our own borders.” Said Dr. Ahmed Mutawa from GOIC.

“We are pleased to join Gulf Finance House in this partnership as it forms one of the main industrial development initiatives in the region. We believe our plans for this company will give us the competitive advantages required to become a serious regional player’, said Ahmed Al Qattan, Vice Chairman and Managing Director of Khaleej Development Company (KDC).

Commenting on the technical plans of the company, Supriya Das Gupta, the Chairman of MN Dastur said, “The plants will adopt the latest technology and manufacturing techniques by partnering with leaders in steel manufacturing; employing the most up-to-date technology and processes.”

“Beyond the immediate economic benefits, this kind of initiative has a wide-ranging impact on employment levels and standards of life. Steel production generates a strong pipeline of follow on jobs in engineering, manufacturing, design and support sectors – all of which provide jobs and improved standards of living” said Professor Abdulatif Al Meer, Managing Director of Q-Invest in Qatar.