MANAMA: Capital Management House (CMH), a Bahrain-based investment bank, has entered into a joint venture with Skaugen Marine Company SE (SMC), a wholly-owned subsidiary of I.M. Skaugen SE (IMS), a leading Norwegian petrochemical and logistics transportation marine company, and nogaholding Company, the business and investment arm of Bahrain's National Oil & Gas Authority (NOGA), in Skaugen Gulf Petrochem Carriers BSC (SGPC). CMH and nogaholding have acquired shares in SGPC, which was formed by IMS and began operations in November 2009. CMH and nogaholding will now control a 30 percent and 35 percent stake in the company, respectively. SGPC, headquartered in Bahrain, is a petrochemical shipping company that owns and operates ethylene, LNG and LPG carriers between the Middle East and global markets. The company operates as part of a joint pool of transportation vessels serving the leading petrochemical producers of the GCC region. SGPC's activities in the growing regional carrier market will be supported and advanced by the strength of its shareholders. IMS has nearly 100 years of history in the shipping industry, providing the company with strong operational and technical expertise, while nogaholding and CMH will add regional and financial experience as well as strong track records of investing in and developing market leading businesses in the energy and related support services industries across the MENA region. SGPC will also continue to benefit from its strategic location in Bahrain in the heart of the Gulf region, which is fast becoming a global hub for the production and export of petrochemicals. It is expected that by 2015, approximately $170 billion will be invested in the Middle East's petrochemicals sector, where significant developments have already been made in dramatically expanding capacity. GCC players, in particular, have moved to the forefront of the global industry as a result of easy and cost-effective access to feedstock and close proximately to the Asian markets, which remain the primary drivers for growth in demand for petrochemicals and the reason behind a structural shift in terms of trading patterns, which have seen Middle East to Asia emerge as a major trade and shipping route. In line with the expansion of the region's petrochemicals sector, the need for additional shipping capacity has also grown significantly, simultaneously creating strong market opportunities for companies within the chemicals shipping industry and those players located within the Gulf region. Khalid Al Bassam, chairman of CMH, said: "We are delighted to be working with I.M. Skaugen and nogaholding on this deal, which demonstrates CMH's continued ability to deliver new and exciting opportunities for our investors across asset classes and sectors. With the rapid growth of the region's petrochemicals industry, we believe this investment is a timely one, allowing CMH, our partners and other prospective co-investors to benefit from the ever-increasing need for shipping capacity from petrochemical producers of the Gulf region to Asian markets. With the shipping industry being cyclical, we have made this investment at the bottom of the cycle in terms of asset prices but also in time to be able to fully leverage the positive outlook for the sector and the attractive long-term opportunities it provides for growth and sustainable returns. Since its establishment, SGPC has been a profitable company.
