Ominvest plans to raise RO50mn in bond issue

Oman International Development and Investment Company is gearing up to publicly issue an RO50mn perpetual bond to seize future growth 

Ominvest Office Building 3

Perpetual bonds valued at RO50mn will be issued by Oman International Investment and Development Company (Ominvest), a leading investment holding company in the Mena region.

The bond issue, which will be a public issue, will help Ominvest to seize future growth opportunities and further strengthen its balance sheet and funding structure.

Ominvest holds substantial interests in the banking, insurance and leasing sectors and building its capabilities in financial investments, investment banking and real estate.

To achieve its goal of enhancing and sustaining shareholder value, the investment firm is focused on six major initiatives, which include further build its presence in the banking sector through Oman Arab bank and help improve performance of other strategic investments in the sector, expand footprint in the regional insurance sector through its subsidiary National Life & General via organic growth and bolt-on acquisitions, and explore strategic collaborations among its leasing associates National Finance and Oman Orix to realise synergies.

Other initiatives are to build and grow its investment banking and asset management platform, U-Capital, to provide value-added services to clients and generate steady fee income, develop a diverse and high quality portfolio of financial investments in public and private equity through its subsidiary Oman National Investment Corporation (ONIC), and develop a top-tier real estate investment and projects advisory business through its subsidiary Oman Orix.

Ominvest enjoys a strong liquidity position and ample funding lines from local and regional banks at highly attractive rates. The issuance of the perpetual bonds is part of the company’s strategic plan, which was approved by the board early this year. Issuance of the bonds will further strengthen Ominvest’s funding base and put in place a source of permanent capital, which will also enhance asset-liability matching — as most of its investments tends to be long-term. Just as Ominvest is preparing to launch its perpetual bond, the company has received a BBB (investment grade) rating with a Stable Outlook from Capital Intelligence.

The initiatives, which are already well under way, will help diversify Ominvest’s revenue streams, keep potential risks well under control across the group companies, improve quality of earnings, help attract high quality human capital to create durable value for all stakeholders.

Meanwhile, Ominvest earlier said that its total group revenue rose by 12 per cent to OMR119.9 million for the first half of 2017, over the same period in 2016. The group’s net profit grew by 14 per cent to OMR18.9 million for the first half, over the same periof of last year. The increase in net profit was attributable to the strong performance of its major subsidiaries — National Life and General Insurance, Oman Arab Bank, Oman National Investment Corporation and 13 associate companies.

Oman Arab Bank reported a net profit of OMR11.96 million for the first half of 2017, compared to RO11.46mn for the same period of 2016. OAB increased its loan and advances by 6 per cent to RO1.69bn compared to RO1.59bn by end-December 2016. Customer deposits rose by 4 per cent toRO1.7bn compared to RO1.63bn by end-December 2016. The shareholders’ funds increased by 4 per cent to RO263mn in the first half from RO253mn by end-December 2016.

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