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Sun 20 Jun 2010 02:25 PM

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Gulf Air, Alba losses dent Bahrain's Mumtalakat's results

Sovereign wealth fund's 2009 net loss doubled due to higher losses at portfolio companies.

Gulf Air, Alba losses dent Bahrain's Mumtalakat's results
NATIONAL CARRIER: Gulf Airs full-year loss rose 21 percent to $502.9 million last year.

Bahrain's sovereign wealth fund Mumtalakat Holding's full-year net loss in 2009 more than doubled due to higher losses at its portfolio companies Gulf Air and Aluminium Bahrain, a document showed.

Mumtalakat, which bundles Bahrain's non-oil state-owned companies, said in an investor presentation reviewed by Reuters that its 2009 net loss was $487.2 million, compared with a loss of $184.3 million in 2008.

It said Gulf Air's full-year loss rose 21 percent to $502.9 million last year, while Aluminium Bahrain (Alba), in which it owns a 77 percent stake, swung to a full-year net loss of $220.7 million, compared with a profit of $781.9 million in 2008.

Mumtalakat said in February it would transfer ownership of the loss-making carrier to the Bahraini government as it was not attractive enough as an investment, but in the presentation it said it owned 100 percent of the airline.

The fund also said derivative losses of $170.6 million contributed to the rise in net losses.

Mumtalakat is currently on a fixed-income road-show. It said in the presentation it would use the proceeds to pay down some of its debt and for general corporate purposes.

Emerging bond markets are improving and Gulf Arab issuers are eagerly waiting for global markets to be more favorable towards the region as the impact of debt restructuring in Dubai becomes more visible.

The emirate of Dubai has also held investor meetings this month and may launch an Islamic bond in the third quarter, bankers have said.

Mumtalakat's road-show will end on Tuesday with investor meetings in Germany and Switzerland. Markets expect it to issue a benchmark-sized bond, according to IFR, a Thomson Reuters publication. Ratings agencies Fitch and Standard & Poor's have assigned 'A' ratings to the expected issue. (Reuters)

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