NEW CHAPTER

Dana Nasser Al Sabah, Group CEO of the Kuwait Projects Company (Holding)-KIPCO- had a tough job ahead of her when she took the role at the beginning of the year. As she leads the company through a vital new merger, she's looking to further M&A activity to boost the company's performance.

- LAYAN ABO SHKIER

Just three months after Dana Nasser Al Sabah, Group CEO of KIPCO, took the top job in January 2022, she found herself making one of the biggest announcements in the company’s 47-year history.

At its annual Shafafiyah (Transparency) Investors’ Forum in April 2022, KIPCO announced that it was exploring a merger with one of its portfolio companies, Qurain Petrochemical Industries Company (QPIC). “We look to 2022 as the year of transformation for KIPCO,” said Al Sabah in a statement at the time.

The year has started strong for KIPCO. It recorded profits of $18.8 million in the first quarter, compared to a loss of $24.2 million in Q1 2021. According to Al Sabah, this recovery was mainly driven by the group’s banking, insurance, and petrochemical businesses, with its real estate segment returning to positive operating revenue in 2022.

The latest results must come as a welcome relief for KIPCO. The QPIC merger is a dealbreaker for the group’s financial survival, according to S&P Global Ratings, who placed the group on CreditWatch negative on May 28, 2022. This reportedly comes as a result of KIPCO’s inability to reduce its leverage in 2021 despite a number of rights offerings, with its cashflow declining sharply due to the pumping of additional money into some important investments, according to S&P. Describing it as “a highly transformative event,” the credit agency reports that the merger “would potentially limit further erosion in KIPCO’s credit profile in the case of a successful completion.”