May 24, 2010Investment fund offers chance to help rebuild Iraq
British investors will be given their first opportunity to invest in the reconstruction of Iraq this week with the launch of two new funds aimed at financing the country’s development.
MerchantBridge, a boutique investment house, is sending prospectuses for The Mesopotamia Fund to City institutions this week. It is hoping to raise $50 million (£34.5 million). The fund will be listed on the Iraq Stock Exchange and will invest in other listed companies.
Basil al-Rahim, the chief executive of MerchantBridge, said that Iraq was on the cusp of an economic breakthrough and that the Mesopotamia Fund initially would invest in financial services and hotels.
The market capitalisation of the exchange, which reopened after the war in 2004, has doubled to $3.3 billion in the past five years. It has more than 100 companies listed, most of which are small banks, but the Iraqi Government is planning a series of privatisations, including the telecoms sector, next year. Hotels make up another large percentage of the Iraqi market.
Mr al-Rahim admitted that Iraq would be a tough sell for some investors, but insisted there were opportunities in the country: “There is a big difference between Iraq and somewhere like Afghanistan,” he said
MerchantBridge is also seeking $40 million from investors to help to rebuild a cement factory outside Baghdad. The factory is backed by the International Finance Corporation, a division of the World Bank, and Lafarge, the French cement company, both of which will invest $200 million in the facility to increase its capacity.
The London-based MerchantBridge specialises in Middle Eastern projects. It believes that growing oil wealth in Iraq, an educated population and ample water supplies will enable the country to modernise.
The London-based MerchantBridge specialises in Middle Eastern projects. It believes that growing oil wealth in Iraq, an educated population and ample water supplies will enable the country to modernise.
