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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

Ugandan tycoon Charles Mbire to pocket $1.15-million interim dividend from MTN Uganda

Mbire owns a significant 3.98-percent stake in the Ugandan telecom outfit.

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Charles Mbire.

Ugandan multimillionaire businessman Charles Mbire is on track to receive an interim dividend of Ush4.48 billion ($1.155 million) from his stake in MTN Uganda after the telecom group reported a double-digit percent increase in earnings in the first half of 2022.

MTN Uganda is Uganda’s leading telecom service operator.

Mbire, the chairman of MTN Uganda and one of Uganda’s wealthiest businessmen, owns a significant 3.98-percent stake in the Ugandan telecom outfit, which operates as the fourth operating subsidiary of the South African multinational mobile telecom company, MTN Group.

The interim dividend will be paid electronically into his bank account at a later date from the group’s retained earnings of Ush902 billion ($232.4 million) at the end of its 2022 fiscal year. It is his first dividend from the telecom company since its shares were listed more than eight months ago.

The dividend payment follows a significant rise in the group’s earnings in the first half of 2022 despite a 4.9-percent decline in voice revenue, as it looks set to replicate its stellar performance in 2021.

As a result of the company’s strong financial performance, the board of directors approved the payment of an interim dividend of Ush5 ($0.00128) per share for the six months ending June 30, totaling Ush11.95 billion ($28.9 million), which is subject to withholding taxes.

According to data retrieved from the company’s earnings report for the first six months of 2022, its profit increased by 48.1 percent to Ush193.6 billion ($50.2 million) in the first half of 2022, compared to Ush130.7 billion ($33.7 million) in the first half of 2021.

The double-digit increase in profit can be attributed to a 10-percent surge in the company’s service revenue, which was driven by a significant increase in data and fintech revenue, which were more than sufficient to offset the 4.9-percent decline in voice revenue.

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East Africa

Led by Kenyan founder Owen Sakawa, AI-powered startup Elloe acquires Flo by Saada

Elloe was founded in 2021 by Sakawa, Abhijay Rao, and Aaron Madolora.

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Owen Sakawa.

Elloe, a U.S.-based conversational commerce startup led by Kenyan tech entrepreneur Owen Sakawa, has acquired Flo by Saada nearly three months after raising more than $1 million in a pre-seed funding round led by institutional investors.

Flo by Saada is a Kenyan social commerce startup founded by Gerishon Mwaniki.

The acquisition of the startup, which launched in 2019 to enable small and medium enterprises to build solutions and process payments through USSD and programmable SMS, was completed for an undisclosed fee.

Through the acquisition, Elloe will be able to accelerate its next phase of growth by scaling operations for its corporate clients and expanding its footprint beyond its current operations in Kenya and the Philippines.

Commenting on the transaction in a press release obtained by Billionaires.Africa, Elloe CEO and Founder Owen Sakawa said: “The addition of Flo by Saada technology is a natural extension of Elloe’s offerings and fits perfectly into Elloe’s strategy. It transforms customer interactions from simple communications to conversations across the entire spectrum of customer engagement points.”

He added that Elloe will be better positioned to meet customers’ evolving needs in the future as it continues to provide businesses with embedded commerce capabilities to simplify the way that they serve, connect with, and sell to their own customers from anywhere, on any channel.

Elloe was founded in 2021 by Sakawa, Abhijay Rao, and Aaron Madolora as a first-of-its-kind AI-powered, conversational commerce platform that allows small and medium enterprises to buy and sell products online across messaging platforms such as WhatsApp, Facebook Messenger, and Instagram.

With its proprietary technology that assists small businesses in managing their digital sales and customer service through an omnichannel platform that runs on messaging apps, the startup hopes to capitalize on opportunities in the $35-billion conversational commerce market, which has the potential to reach $130 billion by 2025 in emerging markets.

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East Africa

Controlled by Kenyan tycoons, Britam Holdings hints at sale of HF Group stake

Britam has classified its 48.2-percent stake in HF Group as held for sale.

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Peter Munga.

Britam Holdings has announced that it is reviewing a transaction that could result in the sale of all or a portion of its stake in HF Group, a Nairobi-based financial services group with interests in mortgage lending, corporate, and retail banking.

Britam is a diversified investment group and a leading insurer in East Africa.

Kenyan business leaders like Jimnah Mbaru, Peter Munga, James Mwangi, and Jane Wanjiru Michuki have significant shareholdings in the group.

In its 2021 annual report, the group classified its 48.2-percent stake in HF Group as held for sale, stating that it has hired a transaction advisor to engage potential buyers and other viable options within the current fiscal period.

“The directors approved the appointment of a transaction advisor to engage various interested parties with a viable option expected to be realized within the next twelve months,” the group stated.

The move represents a strategic turning point for the group, which is reorganizing its executive structure and reviewing its investments in financial services providers to diversify its portfolio and comply with regulatory guidelines limiting investments in a bank to 10 percent of an insurer’s total assets.

Britam’s latest disclosure comes four months after it completed the sale of a 6.7-percent stake in Kenya’s largest commercial bank Equity Group to the International Finance Corporation for Ksh14 billion ($121 million).

The management also stated that options for its stake in HF Group include reaching out to strategic partners who have the capacity to accelerate and support the process of turning HF Group around as it prepares to transition into mainstream banking.

These other options may assist Britam Group in realizing optimal value from its investment when compared to a full or partial divestment as it prepares to reduce its exposure to publicly traded companies. The position aligns with the group’s new strategy to minimize investment earnings volatility to the point where it has no impact on the group’s overall financial performance.

Since the start of the year, Britam’s shares have decreased in value by more than 20 percent, from Ksh7.5 ($0.063) to Ksh5.94 ($0.0498), resulting in losses of millions of dollars for Mbaru, Munga, Mwangi, and Michuki.

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