Kuwaiti bank Global Investment House (Global), announced on Wednesday the completion of the acquisition of a controlling stake in Al-Sawani Food and Industrial Supply Company - a Saudi-based retailing giant with over 550 outlets spread across 12 regional countries. Omar El-Quqa, executive vice president at Global, said: “We are very proud to announce the completion of this transaction. Our investment today clearly demonstrates our faith in the Company's management and our strong conviction in the company's future.” Established in 1976, Al-Sawani is a forerunner in regional retail, and is among the first GCC businesses which adopted the franchising model. The company was established by members of the Hafiz family, who will continue to hold almost 40 percent of the company's share capital. Al-Sawani currently has 76,000 square meters of retail space through which it retails its portfolio of 36 international apparel and accessories brands including Guess, Benetton, Sfera and Esprit. “We are very bullish on retailing” Shailesh Dash, senior vice president at Global Investment House, said. “Fueled by regional liquidity, and a burgeoning young population, retail in the GCC and the wider MENA region is poised for sizeable growth.” On the group's strategy in retailing, Dash said “we realize that success in retailing entails more than opening shops and acquiring brands. Mall developers need unique concepts and an integrated multi brand and multi product model, and this is what we aspire to build. Our acquisition of Al-Sawani is a step towards realizing this strategy.” Saudi Arabia intends to be among the top 10 competitive nations in the world by 2010 and is expecting multi-billion investments into the Kingdom. Saudi Arabia has been encouraging both the private and the foreign players to invest and become party to the country's growth with the most recent initiative been the signing of the WTO agreement. Retail spending in Saudi Arabia is forecasted to increase by an estimated 15 percent by 2008 with Jeddah poised to offer over 750,000 square meters and Riyadh over 600,000 square meters of shopping space by 2009. In the retail sector, Al-Hokair accounts for 33 percent, Sawani's market share stands at 11 percent, Al Shaya - 9 percent and other small franchises accounts for 34 percent. During the year 2007 alone, Al-Sawani rolled out 101 new stores across 6 countries and plans to roll out another 150 stores between 2008 and 2009. The company plans to expand through acquisition of more brands and entering new markets. Mohammed Abdulqader Hafiz will continue as the CEO of the company.
