Abu Dhabi brings investment fund to London
Abu Dhabi Capital Management is to list Qannas Investments Limited on London’s Alternative Investment Market. Caroline Allen reports.
The listing of Qannas Investments on London’s Alternative Investment Market will take the form of a closed-ended investment company incorporated in Jersey and regulated by the Jersey Financial Services Commission.
UAE-based Abu Dhabi Capital Management (ADCM), an alternative investment management firm, will be the investment manager.
Established in January 2011, ADCM manages more than $100m in assets for institutional and high net-worth investors, deployed in private equity and debt investments.
The ADCM team, based in the UAE capital, is led by its CEO Jassim Alseddiqi and comprises six investment professionals with a total of more than 40 years of investment management and finance experience.
Alseddiqi was previously CEO of Abu Dhabi Capital Group, managing global assets including public equities, hedge funds, fixed income,private equity and real estate.
He played an integral part in establishing several financial firms in the UAE, and was instrumental in setting up Al Nahda Investments, Reem Finance and Essdar Capital.
Qannas will seek to generate a target internal rate of return of at least 20% by investing in a diversified portfolio of undervalued equity and debt investments, with a focus on the Gulf Cooperation Council (GCC) countries.
The Qannas board consists of four directors: three independent directors (Chris Ward, Richard Prosser and Andrew Whelan) and Alseddiqi. It will be chaired by Ward, who has 30 years of corporate finance experience in the UK and the Middle East.
Independent directors Prosser and Whelan have a similar track record. Prosser is a partner of the Appleby Group, a director of its wholly owned trust company, Appleby Trust (Jersey) Limited.
He is also chairman of the Investment Policy Committee of Appleby Trust, which monitors and evaluates the performance of the asset managers throughout the group.
A resident of Jersey, Prosser is also chairman of Aberdeen Latin American Income Fund Limited, Damille Investments II Limited and Threadneedle Investments (C.I.) Limited and a non-executive director of Threadneedle European Property Fund.
Whelan is a chartered fellow of the Chartered Securities & Investment Institute and a founding partner of Ermitage Group following its MBO in 2006 from Liberty Life, South Africa’s life assurance business, backed by venture capital firm Caledonia Investments.
He worked for Morgan Grenfell in 1987 and subsequently with Kleinwort Benson, part of the Dresdner Private Banking Group.
Ward says the GCC is an under-invested region with strong economic growth rates and a wealth of natural resources. GCC countries hold 35% of the world’s known oil reserves and 22% of global gas reserves.
“Liquidity dislocation in the region has led to declines in asset values, creating compelling investment opportunities,” he says.
“Qannas offers a rare opportunity for international investors to access these markets and tap into the expertise of a manager with specialist local knowledge.”
The investment strategy is to acquire assets at a discount to their intrinsic value from vendors who are either distressed or seeking to reposition their investment portfolios.
Qannas will invest 80% of its capital in the GCC region with the balance utilised opportunistically on a global basis.
The capital raising programme aims to minimise cash drag. Qannas intends rapidly to deploy the proceeds of the IPO and subsequent capital raises to a maximum of $200m.
Investors will have full pre-emption rights but will have no obligation to participate in future capital raises. The fee structure designed to align the interests of the investment manager with those of the shareholders.
Investments will be held for three to years with the intention of realising values in line with the anticipated economic recovery.