Industry News

Investment projects in non-oil sector

Kuwait-Azerbaijan Investment Company

On March 30, Azerbaijan Investment Company and the Kuwait Financial House (KFH)-owned "Turkapital" company have signed the Shareholders Agreement on establishment of the "Kuwait-Azerbaijan Investment Company" Closed Joint Stock Company (KAIC). The Agreement was signed by Afgan Isayev, AIC Executive Director, and Fawaz Al Issa, Chairman of Board of "Turkapital".

According to the agreement, the newly-established "Kuwait-Azerbaijan Investment Company" CJSC will attract foreign investment to various spheres of the non-oil sector, invest in domestic enterprises, and provide financial consultancy services and other services. The charter capital of the company will make 500 thousand US dollars and will be split between the shareholders in the following way - "Turkapital"-75% and AIC-25% accordingly. It is planned to gradually increase the charter capital of the company up to 20 million US dollars within two years. The increase will be carried in accordance with the share ratio mentioned above.

KFH was established in the State of Kuwait in 1977, as the first bank operating in accordance with the Islamic Shari'ah Law. KFH is listed on the Kuwait Stock Exchange (KSE).

Caspian International Investment Company

Azerbaijan Investment Company has established a joint investment company with the Islamic Corporation for the Development of the Private Sector (ICD). The investment company will be seeking to invest in businesses operating in non-oil sectors of the Azerbaijan economy, except for those prohibited under Shari’ah (Islamic) Law, such as companies manufacturing alcoholic drinks and pork products, as well as banks and insurance companies offering non-Islamic products and services.

The total amount of charter capital will be 70 million US dollars over next two years. AIC’s participation stake is 14 million US dollars through acquisition of a 20% stake. Additional co-investment has been attracted from Kuwait, Sudan, Yemen and other Arab states.

ICD is a member of the Islamic Development Bank whose mission is to foster economic development and social progress of member countries in accordance with the principles of Shari'ah, i.e., Islamic Law.

Expansion of Local Poultry Production

AIC has invested 12 million manats into the “Davachi Broyler” OJSC by acquiring a 25% stake in the company's charter capital.

The investment by AIC will finance the reconstruction of fourteen farms, supplying them with modern equipment, replacing the production technologies in eight farms, increasing the capacity of existing slotting workshops and adjusting them to the new production capacity, organizing the production of prefabricated chicken products.

Production of the Iodized and Purified Salt

AIC acquired a 25% stake in the charter capital of the Azerbaijan Salt Production Company CJSC.

The total investment has comprised 1.9 million manats. The main purpose of the investment is to construct an iodized (iodated) and purified salt production plant in the Masazir district to help reduce the incidence of illness caused by iodine deficiency. Raw material (salt) of the plant will be obtained from the Lake Masazir and from sources in Turkmenistan. Projected production capacity is 60 000 tons annually.

Production of Dairy Products

AIC and European Bank for Reconstruction and Development have invested to the Milk-Pro Ltd. to finance construction of a new milk processing plant with projected daily production capacity of 150 tons. AIC has invested 4.6 million manats (5.4 million US dollars) into the charter capital of the “Milk-Pro” Ltd. by acquiring a 20% stake.

The overall cost of the project is 12.2 million US dollars, which includes construction of a new milk processing plant in Hovsan settlement and the upgrade of an existing milk processing plant in the Goychay City. The new production facilities will double Milk Pro’s current capacity, while greatly reducing the imports in the dairy sector, which recently stood at 75% of total consumption

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