The firm is working simultaneously on half a dozen exits across its private equity and private debt divisions in a record exit year
Alternative asset management firm Gulf Capital recently completed its full exit from Gulf Marine Services (GMS) through four consecutive block sales over the last month on the London Stock Exchange.
Through a series of a leveraged recapitalisation pre-IPO, a highly successful IPO on the London Stock Exchange, and several block sales post IPO, Gulf Capital completed the realisation of its investment in GMS and generated, in total, a Multiple on Original Invested Capital (MOIC) of over 5.3x and an IRR of 31 per cent for GC Equity Partners II, its second private equity fund which held the GMS investment.
The last four block sales over the last month on the London Stock Exchange completed our final exit from GMS. We are extremely happy with the performance and growth of GMS during our ownership period and by the attractive returns generated for our investors in GC Equity Partners II. From the date of our entry in 2008 until the end of 2017, GMS increased its EBITDA by over 500% and has grown from being a local UAE company to becoming a dominant global leader in its industry,” said Dr. Karim El Solh, CEO and Managing Partner of Private Equity at Gulf Capital.
El Solh added that during this period, the financial performance of GMS has registered an impressive annual compound growth rate (CAGR) of 18 per cent in revenues and over 20 per cent in EBITDA. This proprietary control investment in GMS represents the template for future control growth buy-outs in the Middle East and is a good testimony of the strong returns that can be generated from private equity in the Gulf region.
GMS is one of the leading operators of self-propelled Self Elevated Support Vessels (SESV) in the Middle East and in the Southern North Sea in Europe, with clients in the offshore oil and gas industry and wind turbine installation sector.
"This is a landmark transaction not only for Gulf Capital, but also for private equity in the Middle East. It demonstrates that our region is capable of growing world-class businesses and of competing on a global scale. It also demonstrates that private equity firms in the Middle East can execute successful exits through a combination of leveraged recapitalisations, IPOs and secondary block sales. Gulf Capital is currently evaluating a number of other similar investments in the region and will continue its strategy of partnering with world-class management teams and pursuing proprietary control buy-outs in the Middle East,” said Richard Dallas, Senior Managing Director of Private Equity, Gulf Capital.
Dr. El Solh concluded that 2018 is proving to be a productive year for Gulf Capital with over half a dozen exits under way in the private equity and private debt divisions. “We expect to generate the same amount of proceeds from these exits as the amount we deploy in new investments in 2018, reflecting the increasing maturity of our platform and of our underlying portfolio companies. We are fortunate to be managing the largest private equity fund and the largest private debt fund in the Middle East, with substantial commitments left. We are particularly excited about the prospective investment opportunities in our pipeline given the attractive valuations in the current cycle. We look forward to closing a number of new acquisitions over the coming year as the regional economies recover and resume their growth.”