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An Egyptian pride in the making
In five years, Beltone Financial has emerged as a serious challenger to established players.
- Financial Times
- Published: 23:41 October 3, 2008
Sitting in his bank's offices overlooking the Nile in central Cairo, Ali Al Taheri says that in setting up Beltone Financial, he and his partners wanted to create "the region's number one investment bank of choice".
Five years after Beltone opened its doors, its client list and expansion record suggest that the bank is a serious challenger to more established institutions in the region.
Taheri and his founding partner, Ala Al Deen Saba, chairman, have much experience of transitional markets.
The two former Wall Street bankers established Hermes Financial in Egypt in the early 1990s, when private investment banking was almost unknown there.
Hermes merged with the Egyptian Financial Group in 1996 to become EFG-Hermes, the biggest listed investment bank in the Middle East.
So far, Taheri says, most of Beltone's revenue comes from Egypt, but the aim is for a more "balanced" division with income from across the Arab world.
One of the main changes in the business environment from when Hermes was created is that it is no longer possible to operate "without a thought" to developments in other markets in the region, he says.
Beyond its base in Egypt, Beltone operates in the UAE and Qatar. It also works in Saudi Arabia through a joint venture with BMG Financial Group and has offices in New York.
Assets under management have grown to $6 billion and investment banking clients include such high-profile companies as Abraaj Capital, the private equity house, and Orascom Construction Industries, the fertiliser and building group. Through its partners in Saudi Arabia, Beltone has executed six initial public offerings in the kingdom.
"Our whole vision and strategy was to secure footprints in the markets that were most relevant in the first place and to use that as a platform from which we can expand further," says Taheri, who is a director of the bank.
Libya is next on the list of markets to enter. Taheri says he and his colleagues will be working there "imminently" through local partners. He expects privatisations to be the main focus of business at first.
Moving ahead
Last month the Libyan leader Muammer Gaddafi reiterated his intention to move his country in a capitalist direction and hinted at the privatisation of utilities companies and services such as education.
But the pace and extent of Libya's transformation are uncertain and much remains to be done to build up the country's financial infrastructure. "Part of our qualities is that we have been in markets from the very beginning," Taheri says. "We understand how markets develop from a very nascent perspective and there are huge opportunities, especially when you are talking about transitional economies evolving from what is, for want of a better word, a primitive base."
The Middle East is increasingly regarded as a distinct region, "from an investor point of view", he says. "From a corporate point of view, there is hardly a corporation that does not have an aspiration to be a regional company rather than an indigenous local one."
The explanation, he says, lies not only in globalisation nor the presence of excess liquidity in the oil-producing Gulf countries. There is also an "incentive to deal with the same cultural group" that has been on the rise in recent years.
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