Two Bahrain banks close US deals

17 April 1998

Bahrain International Bank (BIB), an offshore investment bank, has bought the majority of a US company which makes packaging and photo albums. TAIB Bank, another offshore bank in Bahrain, has bought into the operations of a US restaurant chain in Europe, Africa and Asia.

BIB announced on 5 April that it had acquired an 80 per cent stake in Massachusetts-based Thompson Paper Box Company in a deal estimated to be worth $45 million. 'Thompson is another good addition to our direct equity investment portfolio. The company has excellent management and is set to capitalise on the very fast growing segment of gift product concepts in the North American retail market,' said BIB chief executive Robin McIlvenny in a statement. 'We expect that the company will demonstrate exceptional sales growth over the medium term, both through organic growth and by possible acquisitions of smaller rivals.' BIB's profits rose by 41.5 per cent last year to $30.7 million (MEED 20:2:98).

TAIB Bank says it has bought the development and licencing rights for Fuddruckers, a US-based restaurant chain, in Europe, the Middle East, Africa and India. The bank is working with a group of unnamed co-investors and members of the company's management on the deal, whose value has not been disclosed. Under the deal, a Bahrain-based company called Fuddruckers EMA, which is controlled by the bank and its partners, gains licencing rights for Europe, the Middle East, Africa and the Indian subcontinent with an option for the rights in other parts of Asia and in Australia.

The bank and its partners also get six existing restaurants in the Gulf - three in Saudi Arabia, and one each in Kuwait, Oman and Bahrain - as well as restaurants that are being developed in Dubai, Doha, Damascus, Amman and Cairo. Fuddruckers EMA executive director, Paul Sellers, said in a statement that the involvement of TAIB Bank would help to give the chain access in countries where the bank is active - in the Middle East, Central Asia and the Indian subcontinent. The company's regional director Buddy Morin added that the chain would probably have 15 restaurants open at the end of its first year of operations in the region, ahead of schedule.

TAIB Bank, which started as a commercial bank in the 1970s, has turned itself into an investment bank with a securities brokerage attached. Its net profits fell 30 per cent in 1997 to $7.3 million as strong growth in operating profits was offset by large provisions against some of the bank's corporate exposures (MEED 6:2:98).

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