Sudan Giad plans Dubai listing to fund growth
October 18, 2007 (KHARTOUM) — Sudan’s heavy industry group, Giad, plans to float shares in its automotive and metals units on exchanges in Dubai and Khartoum as it seeks to raise funds for expansion, a company official said.
“To expand we need more money so we are looking for people to invest in Giad,” Ahmed Osman, Giad’s director of administration, told Zawya Dow Jones in an interview from his office in Giad Industrial City, on the western bank of the Blue Nile south of Khartoum.
“We are intending to register on the stock markets in Khartoum and Dubai,” Osman said.
Dubai, the second-largest sheikdom in the United Arab Emirates, is seeking to attract Middle East companies to cross list their shares and tap the emirate’s booming finance industry.
“We think Dubai is a more relevant stock market for us,” said Osman. “It is relevant to our operations and they believe in Sudanese business. The Middle East is welcoming for us.”
Giad, which consists of thirteen separate companies that make vehicles and cables as well as metals for oil pipelines, wants to list its Giad-El Sewedy Cables Company, or GESCO and Giad Automotive Industry Company by the end of 2008, Osman said.
“We have chosen our automotive and cables companies because they are both technically ready and financially secure enough to go on the stock exchange,” he added.
Giad group, which was set up by the Sudanese government in 1997 to encourage industry in the country and increase skills in Sudan’s labor force, has become a household name in the Sudan with homegrown Giad passenger cars being favored to foreign imports.
Giad Automotive is the biggest and most profitable of Giad’s operations. It assembles up to 12,000 vehicles a year, ranging from the $15,000 Accent passenger cars licensed by Korea’s Hyundai, to $100,000 heavy-duty trucks licensed by Germany’s Man Group and France’s Renault for sale in Sudan.
GESCO, a 2002 joint venture between Sudan’s Giad and Egypt’s El Sewedy, produces up to 10,000 tons of aluminum and copper wires a year for use as telecommunication, power and control cables in Sudan. El Sewedy owns 45% of the company and the government’s GIAD owns 55%.
“In 2006, 23% of Giad profits were from our automotive company. That is approximately $40 million,” Osman said. “GESCO contributed to $3 million of the net profit.”
Giad Industrial City was built in 1997 by the government to house Giad factories and its 1,500 workers. It spans 15 square kilometers and has its own hospital, schools, mosques and theme parks.
(Zawya Dow Jones)