MENA Holding: Ontrack with one of the Largest Real Estate Projects in Egypt

Interview with Mohamed A. Abdulsalam, CEO of MENA Holding

How much of your work is done here in Kuwait and how much is done abroad?

30% of our investments are in Kuwait and the remaining 70% in Egypt.

Please give a brief history of the MENA Holding and how you evolved over the years.

MENA Holding was established in 1991. Currently, it has a capital of 66 million Kuwaiti Dinar. We have a diverse portfolio, which includes real estate development, contracting, family entertainment, industrial sector, logistics, agriculture and fisheries. Recently, we expanded into the area of food and beverage sector.

Can you chart the growth of the company in terms of the key financial ratios?

During the economic recession, we were in a good position due to our diversified portfolio. Our assets are diversified, thus some the sectors went down and some went up. A balanced diversified portfolio of companies is the key to financial stability and steady cash flows. Since 1991, our net capital has increased several times until we reached the current figure of 66 million Kuwaiti Dinar.

You recently won the Young CEO of the Year Award. What does that mean to you? How would you like to influence the company with your personal philosophy?

I am very proud of this award. I don’t believe that this title was given to me alone, because the company works as a team and I wouldn’t have been able to reach those heights.

I think the right answer to your question would be that this award was won by all of as a team, as employees of MENA Holding.

Of course this is an added value to me, because being named as the Young CEO of the Year 2014 in the Middle East from a reliable institution in Dubai is something to be proud of.

You have a lot of competitors. What makes you different from them? What are your key assets? What differentiates MENA Holding in particular from the rest?

What differentiate us are our diversified assets in terms of sector and geography. Our assets are located in Kuwait, Egypt and Morocco and it is diversified into several sectors. This makes us unique. This is our competitive advantage as a company.

You have presence in Morocco, Egypt and Kuwait. Can you elaborate on that?

In Kuwait, MENA holding has companies involved in the steel industry, K-Span. Moreover, the holding owns a family entertainment business and contracting. In Egypt, our business involves agriculture and fisheries and real estate development. Many of our assets are located in Egypt. We are involved in 3 projects. One of them is the Dream Farms Resort. The other one is a mall, which is still under construction. It is in an area of 75, 000 sq. meters. It is a mall with an office building and a 4 star hotel and the final one is an Ayat project (El-Mahroussa city) located in Giza on an area of 26,000 acres.

What can you bring to your clients?

We have several different companies. If you ask me what we bring to our clients in terms of entertainment. My answer would be ‘joy’. We bring joy to the kids and the audience and make them happy. With respect to the steel industry, we always strive to meet their standards with respect to quality and time.

Do you feel the challenge to attract investors?

MENA holding was listed in 2005. It was open for everyone to invest in it, depending on the investor’s criteria. We are very transparent company. The investors are free to look into our financial statements, our performance. They have the freedom to either invest or not. On the other hand, we as the management, we try to maximize the revenue and the value of the company.

What are your main challenges?

Our main challenges are expanding in new sectors and regions. For example, we are currently establishing a new steel industry business and K-Span systems in Qatar.

What are the steps involved in this

It depends. There are so many opportunities and we are looking at picking the right business to earn profits for our shareholders. It not only involves going to other countries and expanding our business. It is also about looking for new opportunities, to venture into new sector to further diversify our portfolio.

Have you seen a growth?

We have been growing. We have more than 1200 employees in our group of companies in Kuwait. In Kuwait, the revenue from our industrial and entertainment sector has increased by 30% every year since 2012. Real estate development, contracting etc. have increased in revenue by varying percentages.

What about your presence in other countries?

MENA holding, through one of its subsidiaries, the Egypt-Gulf for Investment and Development, is involved in one of the biggest projects in Egypt and the region. It used to be an agricultural land. The project is currently on hold as due to ongoing negotiations with the new government in Egypt. We hope to reach a fair settlement with the government very soon.

Can you just tell us a bit more about the scale of the project?

The project is one of the largest real estate developments in Egypt. El Mahroussa City is planned to accommodate more than 2-million people. The land will be developed into a full-fledged urban development (El Mahroussa City) with an adjacent International Airport serving West of Cairo.

It features residential buildings, offices, commercial developments, an airport, heal care facilities, entertainment facilities, an industrial zone, universities and logistics infrastructure. It will be like planning a completely new city in Egypt that can offer more than 200, 000 jobs. The timeline for the project is 25 years. It will also include a high rise building. The benefit of the project to the local economy is enormous.

Where is it located?

It is on the border of Great Cairo. It is located between three major cities in Egypt, Giza, bany swif and Fayum. It is a very prime location, easily accessible through highways around the city.

What are the challenges of working here?

Every month, we look into many opportunities. Our aim in 2015 is to find good opportunities or to acquire properties or to expand etc. Currently, our focus is to reach a fair settlement with the Egyptian government for the Ayat project (El Mahroussa City).

How do you manage so many companies under one umbrella?

Each company has its own management. Some of the departments are centralized in MENA holding.
For example HR, IT, company affairs, legal etc. But the technical departments work onsite in each subsidiary.

What is your biggest challenge when it comes to managing these individual companies?

My biggest challenge since becoming the CEO of the MENA holding is to make all the employees here feel that they are working in their own company. To reach this level requires a lot of effort. This is because of the efforts of the higher management to help increasing the loyalty of the employees. So, we have managed to introduce several programs to increase the loyalty of our employees. We have succeeded in achieving this. This has been our main challenge. The most important asset in any organization is the human resources. Without their loyalty, we cannot step forward.

I understand there are several departments such as HR, legal etc. are managed by MENA Holding on an individual basis. These companies have a separate management.

Yes, they are centralized in MENA Holding. The subsidiaries have representatives of these departments. But they operate independently of MENA Holding. But, we monitor them through our systems and through weekly, monthly and quarterly reports. We have meetings with the executives of these subsidiaries on a weekly and monthly basis.

Your main objective is to expand and to bring the maximum revenue for your shareholders and to take up the best sectors in order to bring in good revenue. How easy is it to do that?

It is one of the most challenging parts of the business. In order to expand, we need to do market study, feasibility study, to foresee the impact of our actions on our shareholders. If we want to exit an investment, we also need to do the same thing. This involves a lot of efforts from all the departments