UAE mall owner launches $150m MENA equity fund

Major UAE retail mall owner Majid Al Futtaim Group has launched a $150m open-ended equity fund to invest in the Middle East and North Africa, and said it may start a fixed-income fund later this year.

Majid Al Futtaim Asset Management, a unit of the privately owned Majid Al Futtaim Group, said on Wednesday that the equity fund will be based in Luxembourg and won't have a fixed rate of return.

"Increasing market liberalisation, attractive valuations, and low currency risk offer good opportunities for investors, especially those who currently have limited exposure to the MENA region," Majid Al-Futtaim Asset Management Chief Executive Iyad Malas said at a press conference in Dubai.

Stocks markets in the oil-rich Gulf Arab region and other countries in the Middle East tumbled at the end of last year, hit by the global financial crisis.

Saudi Arabia's stock market, the biggest in the region, shed 57 percent of its value in 2008, the second-worst performer in the Gulf Arab region.

It has since recouped some of its losses, rising by 25 percent so far this year.

Last month, Bahrain's Al Baraka Banking Group said it planned to launch two funds in May worth about $150m to invest in Gulf Arab equities as the market nears its bottom.

Majid Al Futtaim Group, which has capital and reserves exceeding $5.4bn, owns and operates retail malls and franchises in the Gulf Arab region.

It is seeding the $150m fund from its $300m Middle East and North Africa Trust portfolio, Malas said.

The equity fund is the first product to be launched by Majid Al Futtaim Asset Management, which manages investments for the Majid Al Futtaim family.

The company could launch a fixed-income fund, depending on the market, Malas said.

"This could be something we could do later this year," Malas said. "In bonds, you could do much larger funds. The fixed income market in this region is at an attractive time and yields are quite attractive." (Reuters)

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