An increasing number of mid-cap German firms are eyeing joint ventures and alliances with Gulf partners as a means to tap opportunities in the region and diversify their portfolios, the head of boutique investment bank FCF said.
Sectors include those where the specialisation and expertise of German firms and high-net Gulf investors can collaborate, Arno Fuchs, the chief executive of the German bank, said in an interview with Reuters.
Strategic partnerships between companies with a market cap of between $100 million and $1 billion in the industrial and high technology are a natural investment fit for Gulf institutional and high networth investors, Fuchs said.
“There is now a shift towards strategically oriented investors. The companies that investors are opting for do have a strategic interest,” he said.
Matchmaker
Fuchs said Schoeller Bleckmann Oilfield Equipment – an Austrian firm – is one of the companies that attended a capital markets day organised by FCF in Abu Dhabi for which the bank hopes to act as a matchmaker in a German-Gulf alliance.
Aurubis, Europe’s biggest copper producer, also participated in the conference, as well as firms from sectors such as renewable energy, aircraft engines, and private equity.
“The products that Germany has to offer are the products the region needs,” Fuchs said. “Moreover the weaker euro is cheaper for the import of infrastructure project equipment.”
Privately owned Stulz H+E, a water and wastewater treatment specialist, is broadening its presence in the region through new talks with Kuwait’s Kharafi National for a strategic cooperation for wastewater treatment plants in Kuwait and the UAE.
Another listed German company, PSI AG, specialising in control and monitoring systems for the energy, utility, and chemical industries told Reuters in an e-mailed statement that it had a deal with a Saudi Arabian industrial firm to implement test applications.
Gulf states have stakes in several high-profile German multinationals, predominantly through their burgeoning sovereign wealth funds. These include Qatar Holding’s 10 per cent stake in carmaker Porsche, and Kuwait Investment Authority’s 6.9 per cent stake in auto giant Daimler.
