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A blitz interview with Mohammad Al Duaij, a scion of one of Kuwait’s most prominent dynasties

Al Duaij is the CEO of Alea Global Group.

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Kuwaiti businessman, Alea Global Group CEO Mohammad Al Duaij.

Kuwaiti businessman Mohammad Al Duaij is the CEO of Alea Global Group. The single-family office invests the wealth that his family accumulated over several decades through real estate development and general trading activities in the Middle East into companies and projects that span sectors and geographies.

In 2019, Al Duaij launched the Africa Family Office Investment Summit, an annual event designed for family offices on the continent and those who want to connect with them. He recently had a brief conversation with Billionaires.Africa about the under-representation of family offices in the region, how family businesses on the continent can sustain legacy and the ambitions of the Africa Family Office Investment Summit.

With that introduction, we hope that you enjoy our blitz tet-a-tet with the Kuwaiti entrepreneur.

You are a scion of one of Kuwait’s most prominent business dynasties. Can you walk us through a bit of your family’s history?

– The Al Duaij family is originally from Saudi Arabia and moved to Kuwait in the 17th century. They built one of the main avenues of the old Souq in the country, called Souq Bin Duaij, which still carries our name. They also established the first water foundation in Kuwait, Sabeel Al Duaij, to distribute fresh and clean water to the public for free. The source of my family’s wealth was initially real estate and trading.

– You run your own family office, Alea Global Group. Over the course of your time running Alea Global, what has changed in the family office investing universe and where do you believe trends could evolve from here?

– Alea invested primarily in real estate in Kuwait and Saudi Arabia with a private equity portfolio in Europe before I joined as the group CEO in 2008. We then expanded into Latin America where we purchased agricultural land in Brazil, as well as into the physical commodities business, which we manage out of Asia.

COVID-19 brought the attention of many wealthy families to the need to invest locally and into projects that carry a significant social impact. At Alea, we started to invest locally first in agriculture, in order to meet the current demand, as well as in renewable energy, which we believe is the future. However, we continue to look for opportunities abroad. Frontier markets are on the investment radar for many family offices.

– Africa has the least representation in terms of the number of family offices in the region compared to Euro, Asia and the Middle East. In your opinion, what do you think are major hurdles stalling the rise of family offices in Africa?

– We started to see family office terminology arise in the Middle East only over the past 10 years. I think that Africa already has the concept of family offices, but not the terminology. As African governments start pushing to develop their business environment, we will start to notice African family offices getting stronger.

– What are the real struggles non-African family offices based in the continent go through while doing business in the region? Are there common challenges these family offices face or do the challenges vary from country to country within the region?

– The challenges vary from country to country depending on how the economy is developing and the level of transparency there. In some African countries, there is a lack of transparency and the international business foundation still lags far behind when compared to other regions. This makes some family offices around the world a bit hesitant to jump in. There is also the difficulty of doing due diligence and managing the business from abroad. These are two other factors that make it harder to do business in some African countries.

– Are economic policies in the region more favorable to indigenous family offices compared to foreign family offices based in Africa?

– Economic policies are one of the major factors that family offices consider when making an investment decision. This is why Africa is experiencing less foreign capital inflow compared to other regions.

– Most family offices are renowned for longevity, with businesses that thrive from one generation to another. What exactly informs the succession plan of most of these long-standing family offices?

– Generations need to feel responsible toward their family legacy and appreciate the brand name.

– In the event where prospective successors decide to deviate from the family’s line of businesses or show a lack of interest, what can be done to sustain its business legacy?

– First, you need to build the passion to work for the family business or family office in the successors at an early stage in their lives, so they will feel a responsibility toward the family legacy. However, if a family member is not interested in getting involved, I believe that compromise is the best approach. This could mean integrating new businesses that better match the interests of that specific member of the family.

What inspired you to convene the Africa Family Office Investment Summit and what do you hope to achieve with it both in the short, medium and long term?

– Africa is always on our radar, as we have strong ties with a number of African families. Our plan is to cover every continent. The chief objective of the Africa Family Office Investment Summit is to create opportunities for like-minded professionals, and to solve problems together. In the long term, we hope to build a platform where African family offices can exchange expertise, share knowledge and invest together.

– What are the two most important things for African governments to put in place to encourage foreign direct investments from other family offices outside Africa?

– Market transparency. And African governments also need to facilitate the flow of funds and improve legislation.

East Africa

Kenyan multimillionaire banker James Mwangi loses nearly $5 million in 56 days as Equity Group shares retreat from 21-month high

Equity Group Holdings Limited is a leading financial services holding based in Nairobi.

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Kenyan multimillionaire banker James Mwangi.

Kenyan multimillionaire businessman James Mwangi has seen the market value of his stake in Equity Group Holdings decline by Ksh550 million ($4.96 million) in the past 56 days, as shares in the Kenya-based group retreated from a record 21-month high.

Equity Group Holdings Limited is a leading financial services holding headquartered in Nairobi, the capital and largest city of Kenya.

Under the leadership of Mwangi, the holding has grown into one of the largest financial services groups in East Africa, operating through its subsidiaries in Uganda, Tanzania, South Sudan, Rwanda and the Democratic Republic of Congo, in addition to its Kenyan operations.

As of press time, Oct. 22, shares in the Kenya-based financial services group were trading at KSh49.95 ($0.451) per share, 91-basis points higher than its opening price this morning.

In recent times, Equity Group has lost nearly eight percent of its market capitalization on the Nairobi bourse, as investors book profits after the share price surged to a record 21-month high of Ksh54.25 ($0.489) on Aug. 27.

Since Aug. 27, the group’s share price has declined from a price of Ksh54.25 ($0.489) to KSh49.95 ($0.451) as of the time of writing, accruing a loss of 7.5-percent for shareholders and insiders, such as Mwangi, who hold stakes in the financial services group.

As a result of the decline in the group’s share price, the market value of Mwangi’s stake has declined from Ksh6.93 billion ($62.55 million) to Ksh6.38 billion ($57.6 billion) between Aug. 27 and Oct. 22.

This translates to a loss of Ksh550 million ($4.96 million) for the multimillionaire banker in 56 days.

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East Africa

Kenyan mogul Julius Mwale offers $20 million to farmers to restore activity at Mumias Sugar

The funds will be used to kickstart sugarcane cultivation and sugar production.

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Kenyan mogul Julius Mwale.

Kenyan tech tycoon and Mwale Medical and Technology City (MMTC) owner Julius Mwale has offered Ksh2.2 billion ($20 million) to farmers in an effort to restore sugarcane farming.

According to recent reports, Mwale said the funds will be used to provide farmers with capital to kickstart sugarcane cultivation and sugar production, and to boost the industry at large.

The capital commitment follows his successful Ksh27.6-billion ($249.31 million) bid made through his Tumaz & Tumaz Enterprise as part of a leasing tender to take control of Mumias Sugar over a 15-year period.

Mwale, who received a $200-million (Sh22.1 billion) loan commitment from a leading U.S. bank to strengthen his chances of taking home the lease, placed the highest bid from among eight bidders looking to assume control of the company, according to the receiver-manager, Ponangipali Rao.

His $249.31-million bid was higher than the Ksh8.4 billion ($75.9 million) that Devki Group owner Narendra Raval offered to take control of Mumias and the KSh3.5 billion ($31.61 million) that Kenyan businessman Jaswant Rai offered through his company, Rai Group.

Mwale’s $20-million commitment is expected to go to farmers who abandoned the Mumias plantation after the sugar-production company ran into a financial crisis three years ago.

In addition, Mwale disclosed that a sum of KSh2.2 billion ($20 million), Ksh887 million ($8 million) and Ksh221 million ($2 million) will be allocated, respectively, to revive two ethanol plants owned by the company, its power generation unit and its water-bottling plant.

Mwale also plans to allocate Sh2.2 billion ($20 million) each to build an airport, an agricultural research university, a sugar tourist resort, a housing project and a hospital at the Mumias complex.

Mwale is the president and CEO of SBA Technologies, a New York-based company founded in 2003.

He is also the lead investor in MMTC, a $2-billion community-owned sustainable metropolis with an extensive medical and technology complex that contains a shopping and residential unit, a golf resort and a convention center.

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East Africa

Ethiopian billionaire Mohammed Al-Amoudi gains $360 million in 21 days after losing $530 million between July and September

His $7.2-billion fortune is derived from closely held companies such as Preem, Svenska Petroleum and Midroc Europe.

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Ethiopian billionaire Mohammed Al-Amoudi.

Ethiopia-born billionaire Mohammed Al-Amoudi has recorded a $360-million boost in his net worth in the past 21 days after his wealth fell by $530 million between July and September.

The billionaire, whose real-time fortune of $7.2 billion is derived from closely held companies such as Svenska Petroleum, Midroc Europe (a construction and property group) and Preem (his most valuable asset), has seen his net worth increase by 5.26 percent since Sept. 29.

Data retrieved from the Bloomberg Billionaires Index revealed that his net worth has increased from $6.84 billion on Sept. 29 to $7.20 as of the time of writing, Oct. 21, owing to an increase in the valuation of his assets across Sweden, Saudi Arabia and Ethiopia.

This translates to a net worth gain of $360 million for the billionaire in the past 21 days.

Between July 28 and Sept. 29, his net worth fell from a valuation of $7.37 billion to $6.84 billion.

The recent increase in his net worth is linked to a revaluation of his equity interest in companies, and specifically his ownership interest in Svenska and Preem, the largest fuel company in Sweden, with an annual refining capacity of more than 18 million cubic meters of crude oil.

Recently, Pyrocell, a Preem subsidiary, announced that a biofuel plant producing pyrolysis is under way. This is in line with the group’s commitment to achieving large-scale renewables production.

The plant, which is located in Gavle, Sweden, will produce around 25,000 tonnes of non-fossil pyrolysis per year, which equates to the annual fuel consumption of 15,000 passenger vehicles.

Al-Amoudi’s net worth of $7.20 billion makes him the 387th richest man in the world behind U.S. businessman and investor Tom Gores, who is $20-million richer.

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