Bahrain’s Investcorp plans up to six new investments

Investcorp aims to more than double its assets under management in the next five to seven years

Bahrain-based Investcorp is aiming to make one to two new investments in the next year in each of its regions of the United States, Europe and the Gulf, co-chief executive Rishi Kapoor said on Thursday.

The investments will help contribute to Investcorp’s goal of more than doubling its assets under management in the next five to seven years from the current level of $10.8bn, Kapoor told reporters on a conference call.

He was speaking after the company posted a 45.1 per cent drop in its second-half net profit to $39.2m and 22.8 per cent fall in profits to $90.1m for the full year ended June 30.

The company said the decline in performance was mainly due to a rise in operating expenses as a result of expanding Investcorp’s resources and infrastructure. The company’s global staffing rose 8 per cent during the period.

Founded in 1982, making it one of the oldest Middle Eastern private equity investors, Investcorp was initially best known for buying into and then listing luxury goods brands such as Gucci and Tiffany & Co, but has long since branched out into many other sectors.

Earlier this week it announced the sale of British snack foods maker Tyrrells for an enterprise value of 300m pounds to Texas-based Amplify Snack Brands.

Read more: Bahrain’s Investcorp sells UK crisp brand Tyrrells

“We tend to be opportunistic and look at hundreds of opportunities each year,” Kapoor said on Thursday, adding that it only executed roughly a handful of those deals.

Under a new strategy aimed at propelling it into the top tier of global investment companies, the company announced a plan in November last year, to more than double its assets under management in the medium term.

That goal will be aided by Abu Dhabi state investment fund Mubadala, which will become the largest shareholder of Investcorp after agreeing a deal announced last month to acquire a 20 per cent stake.

Read more: Abu Dhabi’s Mubadala to buy 20% of Bahrain’s Investcorp

Investcorp also said its board had proposed paying a dividend of 24 cents per share for the financial year, up from 15 cents in the previous year.

The increase in the dividend was “not a one-off”, said Kapoor.

Fully diluted earnings fell to $0.94 per ordinary share last year from $1.29 in the previous year, while the return on average ordinary shareholders’ equity was 10 per cent, the company said.

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