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FUND IN EXECUTIVE ROLE

Mohammed Al Shroogi

Investcorp buys stake in Saudi car rental firm

Manama, September 25, 2013

Bahrain-based Investcorp, an alternative investment manager, yesterday announced it has bought a 30 per cent stake in a Saudi car rental firm and acquired Paper Source, a premier multi-channel US retailer.

Financial terms of both transactions were not disclosed, said a report in the Gulf Daily News, our sister publication.

The stake in Theeb Rent a Car was bought by Investcorp's Gulf Opportunity Fund, which will be represented on Theeb's board and will play an active role in key decisions which will include both governance as well as future exit strategies.

Theeb was established in 1991 by Homod Al Theeb and Mohammed Al Theeb and today employs 900 people and operates a fleet of more than 10,000 cars.

It is the second largest car rental company in Saudi Arabia, with a market share of about 15 per cent, Mohammed Al Theeb told a Press conference at the Ritz-Carlton Bahrain, Hotel and Spa.

"We hope to achieve double-digit growth over the next five years," said Theeb co-founder and chief executive Mohammed Al Theeb.

"With Investcorp's active support, we believe we are well-positioned to consolidate our position and acquire further market share."

Over the last three years, Theeb has delivered more than 17 per cent growth in both revenues and net income.

"Theeb is a well-respected family business and is poised to grow, driven by Saudi Arabia's accelerating economy," Investcorp's Gulf business president Mohammed Al Shroogi said.

"We will work closely with the Theeb management team to help grow the business. This is the fund's 10th investment within the region and its fourth in Saudi Arabia."

Theeb co-founder and chairman Homod Al Theeb said processes and proper governance were key requirements for the rapidly growing family business.

"We believe Investcorp will be able to assist us on these matters in addition to providing expertise within our sector."

In a separate announcement, Investcorp said it purchased Paper Source from Brentwood Associates, a Los-Angeles-based private equity firm.

Headquartered in Chicago, Illinois, Paper Source operates 73 stores across 23 states of the US, selling stationery, greeting cards, custom stamps, etc.

"Paper Source is a market-leading retailer with a differentiated product offering and exceptional customer service," Al Shroogi said.

According to Paper Source chief executive Sally Pofcher, Investcorp is a highly complementary partner for the company with a track record of growing strong retail brands.

"This transaction provides us with a deep capital base to expand our domestic footprint and pursue direct marketing opportunities, as well as a partner that has an established reputation for working effectively with management teams," she added.

Morgan Joseph TriArtisan acted as financial adviser, and Gibson, Dunn & Crutcher acted as legal advisers. – TradeArabia News Service




Tags: Bahrain | Investcorp |

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