Daman Investments, the UAE-based investment management company, has launched a AED200m ($54.4m) fund focused on investments in the GCC.
The Daman Fifth Fund will focus on blue-chip equities listed on GCC exchanges, debt products and commodities.
According to Shehab Gargash, managing director of Daman Investments, the fund is likely to focus on markets outside the UAE.
“Saudi Arabia and Qatar tell a more compelling story today than Abu Dhabi and Dubai, for example, where the markets are still being held hostage over the lack of clarity from the Dubai World restructuring,” he says.
“We are particularly interested in the petrochemicals sector which should remain strong this year,” he says.
He adds that the telecoms market also looks attractive.
The fund is being marketed to high net-worth and institutional investors in the region, but is also open to international investors. Instead of cash, investors can subscribe with existing securities such as equities, bonds and sukuk.
“We are allowing payments In kind because a lot of investors today are asset-rich but cash-poor, and have securities they currently cannot access,” says Gergash.
As fund manager, Daman will provide the fund’s seed capital, the size of which will be announced at the end of the initial offering period on 7 April 2010. It is targeting an internal rate of return of 25 per cent a year over the life of the fund.