Gulfmena Investments is engaged in the process of restructuring itself from boutique fund house to service provider to help asset managers launch and oversee funds in Dubai.
The firm, which is regulated by the Dubai Financial Services Authority, previously managed $50 million in assets across public equities, alternative strategies and sukuk (Islamic bonds).
But it is understood that poor performance led Gulfmena to move to wind down two of its proprietary funds, the Gulfmena Opportunities Fund and the Gulfmena Access Fund, earlier this year. The firm has declined to comment on performance.
By October last year the Gulfmena Opportunities Fund (class A) had recorded a -16.02% loss net of fees since inception on December 20, 2009. The benchmark S&P Pan Arab LC Index, meanwhile, had dropped -2.56% over this period.
The Gulfmena Access Fund (Class A) was also lacklustre, returning 0.47% net of fees since inception on June 26, 2011. The benchmark S&P Pan Arab LC Index, meanwhile, lost -4.47% over the period
Gulfmena's restructuring came after Haissam Arabi’s departure as CEO of Gulfmena Investments in the first quarter of this year. Stepping in as interim CEO was chief financial officer Marc Hambach, although Gulfmena is expected to announce a new CEO soon.
As part of this restructuring, Private equity research firm LRIM Investment Management increased its stake in Gulfmena to 95% (75% via direct ownership), from 20%. LRIM also owns private equity and corporate advisory firm Investbridge Capital in Dubai.
Hambach has since been promoted to Gulfmena Group chief operating officer, encompassing both Gulfmena Investments and Investbridge Capital.
While Gulfmena is still overseeing $10 million in managed accounts for high-net-worth individuals, family offices and institutions, it has shifted focus to offer legal and compliance oversight and advisory services to asset managers seeking opportunities in Dubai, Hambach tells AsianInvestor.
“We are offering a fund platform to help independent asset managers which may not have a physical presence in Dubai, to set up funds in the Dubai International Financial Centre,” he says.
Gulfmena recently signed a deal to help a US-Malaysian financial services group to launch a fund focused on leasing assets in Saudi Arabia.
Hambach declines to offer much detail on the deal until terms have been finalised, although he says securing this mandate has pushed Gulfmena’s assets in fund services solutions over $50 million.
As European asset managers experience rising operating and compliance costs, many are mulling moving their operations away from the continent. Dubai is one city they’re considering, suggests Hambach.
In addition to the US-Malaysian company, Hambach is providing financing through Investbridge towards a $5 billion petrochemicals project in Egypt. The venture, headed by Cairo-based Carbon Holdings, will produce various olefins and polymers.
Three-quarters of the project’s debt financing will come from the Export-Import Bank of the US and Korea, with Investbridge putting up one quarter of equity financing, Hambach says. In addition, Investbridge will offer advisory services on all development stages of the venture.