Press Release

February 07, 2010

Gulf Capital completes acquisition of a 60% stake in Metito, one of the world’s largest providers of desalination, water and wastewater solutions

Gulf Capital, one of the most active buy-out firms in the Middle East, announced today that it has acquired a majority stake in Metito in the largest Private Equity Investment to date in the fast-growing Middle Eastern water industry.

Metito has been a leading provider of water and wastewater solutions since the late 50’s. Through its operation in 15 countries across the Middle East, Africa and Asia, Metito is ranked among the top global providers of desalination plants with over 2,000 installations worldwide. Metito is also the largest Arab water utility running 16 water concessions globally.

Exponential Growth of Investments in the Regional Water Industry
According to the United Nations, a third of the world population will be living in areas experiencing water shortage, including much of the Middle East. The lack of fresh water compounded by population and economic growth has made water in dire shortage in some parts of the globe, and few companies have focused on providing solutions for this mounting problem.

To alleviate the acute water shortages, investments to the tune of $117 billion are expected to be invested in the Middle East alone between now and 2015. Saudi Arabia, the largest market for water and waste water in the region, is expected to invest $28 billion in the sector over the next 10 years, of which around $6 billion will be allocated for building new desalination water plants. UAE, Egypt, Iran, Iraq and many other Middle Eastern countries will be required to invest heavily in their water sector just to keep up with demand and avoid social and economical problems.

Metito is ideally positioned to meet these demands and further cement its position as the leading Arab provider of water solutions.

Leading the Way in Water Concessions
Given the magnitude of the investments needed, governments have pushed for the privatization of the water sector to the top of their priority list. In Saudi Arabia, Saline Water Conversion Corporation (SWCC) announced recently its plans for the privatization of its water production assets worth around $800 billion. Abu Dhabi Water & Electricity Authority (ADWEA) has started its privatization program since 1997 and has extended it this year to its sewerage treatment facilities. Metito was one of the first regional private companies to tap into this growing trend by running water concessions on a private basis as early as 1999. Metito has accumulated 16 water concession contracts to date in the Arab World, and is on track to secure a number of additional ones, further solidifying its market leadership.

Dr. Karim El Solh, CEO of Gulf Capital, said: “This is truly a landmark deal and we are extremely pleased with this investment. Metito is the market leader in what is possibly one of the most promising sectors in the Middle East. We believe the company has excellent prospects for continued market leadership and growth, especially in the water desalination arena. Metito’s long track record in delivering high quality and cost-effective water solutions to the Arab World is exceptional, and we look forward to working in partnership with management to safeguard and extend that rich legacy.”

Mutaz Ghandour, co-founder and CEO of Metito, said “Gulf Capital’s investment represents a strong endorsement of our management, business plan, market leadership and future growth plans. We are extremely pleased to be partnering with Gulf Capital, one of the region’s most active private equity firms, given their long-term view towards growing the businesses in which they invest and their excellent track record of working in partnership with management to build great companies. With the recent capital infusion and Gulf Capital’s backing, Metito is well positioned to capitalize on the regional opportunities and further cement its position as the leading water utility in the Arab World.”