Dubai's MAF sheds Iranian interests

Developer passes ownership of 75 percent stake in Carrefour in Iran to founder

Dubai developer Majid Al Futtaim (MAF) Holding has shed itself of all financial interests in Iran, concerned about the impact of international sanctions on its ability to attract investors. 

MAF Holding CEO Iyad Malas confirmed on Tuesday the company had passed its 75 percent stake in the Carrefour supermarket franchise in Iran to its shareholder and founder, Majid Al Futtaim, on December 31 last year.

Paris-based Carrefour continued to own its 25 percent share of the brand in Iran.

Malas said while the businesses were growing it was decided that exposure to the Iranian market could affect the MAF group’s ability to attract investors, particularly after MAF issued a US$400m sukuk, or Islamic bond, in February 2012, and a US$500m conventional bond in July.

He insisted the decision was made proactively and that no potential investors had complained.

“The business [in Iran] has grown, it remains to be strong because the Iranian consumer is not unlike any other consumer, they like to go into a modern retail format and buy food and products and what have you,” Malas said.

“We’re trying to make sure that there is no issue with any investor, that would then say I can’t invest in MAF brands because MAF has revenue that is generated in Iran.”

Sanctions against Iran have intensified in recent years amid concerns over its alleged nuclear weapons programme.

Numerous countries and multinational groups including the United States and Europe have banned business dealings with Iranian companies and entities and banking and insurance transactions, as well as the purchase of Iranian oil.

Institutions that do so would be frozen out of the US financial market.

Iran contributed 4 percent to MAF Holding revenue last year – half of the previous year’s 8 percent after the devaluation of the rial.

Malas said the company had complied with sanctions imposed in recent years.

“Nothing is imported, it’s all what’s produced or available locally and on that basis it’s actually grown quite a bit in real terms.”

MAF Properties also confirmed it was pushing ahead with its Cairo-based Mall of Egypt project, with construction due to begin in February.

It also intends to open its first mall in Lebanon in April and has plans to enter Abu Dhabi, Riyadh, Georgia, Armenia, Kazakhstan and Azerbaijan.

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