The Financing Facility will Enable Reach’s Acquisition of Saudi-based HR Outsourcing Company
Dubai, UAE: NBK Capital Partners announced today it closed a US$ 20 million acquisition financing facility with Reach Group, a leading UAE-based HR outsourcing company in support of its cross-border expansion. The innovative Sharia-compliant financing marks the first investment from NBK Capital Partners Shari’ah Credit Opportunities Fund L.P., a fund advised by NBK Capital Partners (the “Shari’ah Credit Opportunities Fund”).
Reach focuses on supplying skilled and semi-skilled employees to government and quasi-government entities and private sector companies. Following a major expansion program over the past decade, the company is entering the massive Saudi market through the acquisition of a HR Recruitment Company, in a strategic partnership with local conglomerate.
Yaser Moustafa, CEO, NBK Capital Partners said: “Reach is a highly reputable leader in outsourced staffing solutions in the region. We were pleased to work with its founder and management team to structure a financing solution that allowed Reach to enter the Saudi market, while positioning their business for additional growth with our capital and strategic support.”
Reach’s Founder and Chief Executive Officer Malik Melhem said: “This transaction provides additional capital for us to expand into Saudi Arabia, which we’ve viewed as a natural growth area for our business. NBK Capital Partners has a great track record with flexible funding solutions, and we are excited to have their support.”
Established in 1999 with offices in Abu Dhabi and Dubai, Reach Group identifies, recruits, and hires employees directly on its payroll and, subsequently, outsources them to its clients, thereby reducing the significant burden of the HR process and associated overhead cost. The company’s clients include government and quasi-government entities on long-term contracts. Reach focuses on sourcing skilled and semi-skilled employees diversified across healthcare, telecommunications, financial services and education sectors. The company has close to 6,000 outsourced full-time employees, making it one of the largest temporary staffing providers in the UAE.
Sikander Ahmed, Managing Director and Head of Private Credit at NBK Capital Partners said: “By providing flexible financing solutions to regional companies in the midst of growth and transformative transitions, we have been able to establish ourselves as reliable and value-add partner that can underwrite complex situations. We are pleased to support the company and its management in regional expansion.”
The investment follows the first close of US$ 300 million Shari’ah Credit Opportunities Fund, anchored by Saudi Arabia’s Public Investment Fund and other institutional investors, which was announced last month.
The third-generation private credit fund is unique in that it combines the successful private credit advisory track record of NBK Capital Partners with the mandate to invest in privately negotiated Shari’ah-compliant credit investments. The Shari’ah Credit Opportunities Fund is expected to make 10 to 12 investments of US$ 15 million to US$ 50 million throughout its eight-year life and to generate attractive cash yield and total returns.
The private credit team at NBK Capital Partners has pioneered advising on Shari’ah-compliant credit investments, with fourteen private credit investments to date across three fund vehicles, five of which have been Shari’ah-compliant.
About NBK Capital Partners:
NBK Capital Partners is the alternative investments arm of Watani Investment Company K.S.C.C. (“NBK Capital”). Regulated by the DFSA, the Firm is headquartered in Dubai International Financial Centre, Dubai, UAE, and its parent company, NBK Capital has office in Kuwait City with a presence in Manama and Istanbul. NBK Capital Partners currently advises investment funds across Private Equity and Private Credit and Real Estate platforms. The Firm targets companies in the MENA region presenting significant growth potential and opportunities for value creation. Since the launch of NBK Capital’s first fund in 2007, NBK Capital Partners has advised in successfully closing 36 investments across a variety of sectors, with 17 consecutive profitable exits to date.