In June Mr Green promised that all of the questions about his consortium and investors in Rangers would be answered “in seven days”. Well, he did not say which seven days!
However last night he has addressed one of the issues – the mysterious Blue Pitch Holdings. His statement from the official Rangers site is below, with my comments beneath.
CHARLES GREEN, Chief Executive, issued the following statement today:
“There has been renewed speculation and media comment recently regarding the current shareholders in The Rangers Football Club. A full list of current shareholders will be published in the share prospectus which will be issued within the next few weeks.
“A lot of attention has focused on investment funds which have taken a shareholding in the Club to date.
“For example, I would like to clarify that in the case of Blue Pitch Holdings, the legal beneficiary is Mazen Houssami and not Arif Naqvi of Abraaj Capital. Mr Naqvi is a personal friend of mine and I approached him early on in the process about a shareholding but he has not proceeded on the basis that the investment fell outside the core geography he invests in.”
We can therefore expect the prospectus in a “few weeks”. Even better, this is the “next” few weeks!
A full list of current shareholders is to be published. Bearing in mind that previously Mr Green announced it would be breaking the law to reveal some of the shareholders, this is an interesting change in his stance. I wonder if any present shareholders would be looking to divest themselves of their shareholding prior to publication of the list in the prospectus?
Blue Pitch Holdings and Mazen Houssami
As far as Blue Pitch Holdings is concerned, we have the name of Mazen Houssami as “the legal beneficiary”.
He has been mentioned before.
Back in May, STV reported the following taken from an interview with Mr Green on the official Rangers website:-
“I can now provide two names, as I have clearance to do so on their part, of investors who are on the list.
“One guy is Jude Allen who is an Indonesian investor and the second is a lawyer from the Middle East Mazen Houssami.
“These two are very prominent in their areas. It’s a great opportunity for us to build on their experience, their connections in those regions because we want to take the Rangers brand into these areas.
“There are other names but for today they are two very prominent businessmen who are backing the football club.
“The reluctance to reveal investors initially was because a lot of these investors are offshore trusts and individuals who didn’t want their name in the press and media because they, like everyone else in the world, have been watching the Rangers story unfold through the media since February and indeed before that and these people are not publicity seekers.”
Now the people who are not publicity seekers will have such thrust upon them, it appears.
What of Mr Houssami?
There is surprisingly little, at first sight, on the Internet regarding Mr Houssami, other than reports from numerous sources of Mr Green’s comments in May, referred to above.
There is a lawyer in Lebanon by that name, listed on the Bar Association of Beirut website as “Mazen Husami”. LinkedIn takes you back to the similarly names Mr Houssami. I assume, as someone with no knowledge of Arabic, that either can be a translation of the family name.
There is a “Mazen Nabil Houssami” listed as Senior Legal Counsel to the Tameer Holding Investment LLC. That company is described as – one of the region’s leading developers, with a number of prestigious projects throughout the region. In 2008, Tameer Towers project in Shams, Abu Dhabi, on Al Reem Island, was announced by International Property Awards the single most accredited development in the world. Tameer is also developing Madinat Al Majd in Amman, Jordan, in collaboration with Jordan’s Housing and Urban Development Corporation (HUDC).
The helpfully vague description of Mr Houssami as a “Middle East” lawyer means that it could be either the Lebanese lawyer of that name practising in Beirut, or the United Arab Emirates based Counsel with Tameer. Indeed, they could be the same man. I have emailed Tameer to ask.
Mr Green of course has history in the Middle East construction game. He was deputy Chairman of Panceltica Holdings. This was a Qatar-based construction company which worked on projects across the Middle East, including in the UAE.
It collapsed into liquidation, and Ecojon has already provided some interesting history regarding it on this site.
The Daily Telegraph in 2008 reported on the bright future which Panceltica had. In particular, it spoke to Mr Green, the Deputy Chairman.
The following are extracts from the Telegraph piece:-
Panceltica, a Qatar-based construction group, will today become the biggest company to list on Aim so far this year. The company, which will float at 100p with a market capitalisation of £236m, is hoping to benefit from the ongoing building boom in the Gulf States.
Panceltica is rolling out a new type of technology …”It’s like putting together a Meccano kit,” explained Charles Green, Panceltica’s deputy chairman.
While Panceltica is not bringing in any new money at this stage, it raised £55m several months ago via the increasingly popular route of pre-IPO financing. This allows companies to obtain new funds without having to worry about the immediate market conditions.
“Clearly you couldn’t pick a worse time to float from a market point of view,” Mr Green noted. “But we’re not concerned about whether the market is good or bad having already done our financing. The amount of management time spent doing an IPO is huge, so getting the fundraising out of the way lets us go back to building houses as opposed to carrying out due diligence.”
Panceltica is confident it can profit from the rapidly-expanding construction market in the Gulf States and house brokers Hichens Harrison are forecasting that pre-tax profits will rise from $27.7m (£13.8m) this year to $59.1m next year and $93m in 2009.
Some investors may be uncomfortable with the complex relationships between the company and its shareholders and customers. For example, Barwa is Panceltica’s biggest customer as well as being a major shareholder with a seat on the board.
However, the directors and strategic investors have entered into a series of relationship agreements so that shareholders will not be able to exert influence over any material contracts where there is a conflict of interest. (All emphases added)
So we had a company coming to the AIM with a huge capitalisation – with great hopes for profits – with the company having just raised a huge sum pre-IPO – with an acknowledgement that an IPO involves a huge expenditure of management time – and with concerns for investors about the close connections of the company to its major shareholders. Hmmm.
It was in liquidation two years later, with the market capitalisation of £236 million reduced to dust.
Is this where Mr Green came into contact with Mr Houssami? Is this a connection from his building days? If so, then clearly Mr Houssami has done far better out of the construction business than Panceltica did!
Presumably the prospectus will give us more details about the mysterious Mr Houssami. After all, Mr Green has promised this!
Arif Naqvi of Abraaj Capital
This man is a hugely successful businessman. It was thought that he was the man behind Blue Pitch Holdings. Again Ecojon has done sterling work on here looking into his background.
But, as Mr Green says, whilst he is a friend to Mr Green, this investment does not fit in “the core geography he (Mr Naqvi) invests in”.
The website for Abraaj Capital states:-
“The Abraaj Capital Group is a leading private equity manager investing in global growth markets. Founded in 2002 by Arif Naqvi, the group has raised over US$ 8 billion and distributed c. US$ 3.5 billion to investors. Employing over 300 people, the group has 33 offices spread across seven regional hubs in Bogota, Dubai, Istanbul, London, Mumbai, Nairobi and Singapore.
Funds managed by the group have holdings in over 150 partner companies that collectively employ in excess of 100,000 people and create sustainable value in sectors including manufacturing, education, retail, aviation, oil and gas, financial payments infrastructure, healthcare and agribusiness. The group’s current partner companies include industry leaders such as Network International, the largest independent payment solutions provider in the Middle East and Africa, Al Borg Laboratories, the Middle East’s largest privately owned medical testing laboratory, Brookside Dairy, the largest dairy in East Africa, and Iasacorp, a long established family run women’s retail business in Peru.”
So we have a “global” growth market investor, with 33 offices across South America, the Middle East, Turkey, LONDON, India, Africa and the Far East.
It has invested in numerous companies round much of the world.
However, despite having a London office, sadly for Mr Green the investment portfolio for the company does not extend geographically to Rangers… That might mean that Scotland falls outwith its investments areas, or the UK, or Western Europe…or maybe only as far as Govan…
Whilst its focus is stated as being “the rapidly growing economies of the Middle East, Africa, South Asia and South East Asia” the location of its offices and stated investments shows that it does put funds into businesses outside the core areas.
It is also fair to say that the success of the Group does not seem to come from turning down investments likely to be of financial benefit to its clients!
Maybe the prospects of success, in addition to the location, gave Mr Naqvi cold feet. Maybe the investment Mr Green wanted from his friend was not large enough to be worth their while. Maybe Mr Naqvi’s personal investment strategy, as opposed to that of his company, excludes Western Europe…
Was the investment Mr Green sought one from the company or from Mr Naqvi personally? Maybe someone could ask one of them?
So, even when Mr Green answers a question, more arise.
- Where is the “Middle East” lawyer, Mr Houssami, based?
- Is he a Beirut practitioner, or Legal Counsel to a huge UAE operation?
- Is he an old pal of Mr Green from Panceltica days?
- Is Mr Houssami a personal investor, or the front man for a group of investors/speculators/old pals of Mr Green?
- What about Mr Naqvi?
- Was it a request from Mr Green that his company should invest, or was it directed to him personally?
- Why wait till now to deny his involvement when it has been rumoured since May?
- How is Mr Green going to cope with the huge amount of management time needed to organise an IPO, bearing in mind the prospectus is due in a few weeks?
- Who are the remaining mysterious investors?
These and many more will, hopefully, be answered as soon as possible and at latest in the eagerly awaited prospectus.
Posted by Paul McConville