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Tue 6 Nov 2007 03:07 AM

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Saudi JV invests in global water projects

Moya Holding launches with paid up capital of $50mn to target projects in Gulf, India and China.

The Saudi Bushnak Group and Bahrain-based Gulf One investment bank announced on Sunday the launch of a water joint-venture, Moya Holding.

Moya, an Arabic word meaning ‘water,’ is registered in Bahrain and will launch with paid up capital of $50 million. The company is established to utilize investment opportunities in water-related projects in key markets in the Gulf, India, and China.

Founders Adil Bushnak and Nahed Taher say they intend to triple the company’s capital within three years of its operation.

Bushnak, the chairman of Bushnak Group, acknowledged that Moya Holding has a modest start-up capital; therefore, he welcomed strategic investors to become partners in Moya Holding to expand its capital base.
Nahed Taher, the CEO of Gulf One, has been appointed as the CEO of the new joint-venture water company. The Bahrain-based Moya Holding will operate in Saudi Arabia as well as in other markets through subsidiaries.

“The investment strategy for Moya Holding is based on forming a project company for each water project that we receive. The project company serves a subsidiary for Moya Holding,” explained Taher.

“Research and development for water technologies is another area that Moya definitely will finance,” added Taher, the former chief economist for Saudi NCB bank before moving to Bahrain to found Gulf One bank that focuses on financing infrastructure projects.

“The demand for water in emerging markets is growing rapidly and the Gulf, India, and China are among the major markets that I want to be in,” said Taher. Taher revealed that Moya has already secured a $100-million water deal in India.

The other active deal Moya made was with Saudi Arabian Airlines to supply the airlines’ head quarter complex and residential compound area with desalinated water.

Bushnak, who is also the chairman of the Saudi Water and Power forum, said that the Saudi deal is a small deal worth $10 to $15 million. “Our company is new and we do not want to go into bigger projects right now,” explained Bushnak.

Bushnak does not fear from competition of larger water companies and independent water producers because his investment strategy relies on going into selective projects. “Moya will not go into each and every tender. Moya will start by selecting its projects,” added Bushank.

Taher showed no fears of the future of the project in case of the privtaizaiton of the Saudi Arabian Airlines which means the loss of government financial support to the airline.

“The cost of financing the project will not increase with the risk that might result from the loss of the sovereign guarantee in the Saudi airlines case,” said Taher who prefers to deal with private entities.

“The demand elasticity for water is minimal hence no matter what the cost of water becomes, the demand level is always stable which makes water projects good ones to finance,” added Taher.

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